MANILA – Philippine merchandise imports increased by 4.1 percent in August 2015 on the back of higher payments for raw materials, intermediate goods, and consumer goods, according to the National Economic and Development Authority (NEDA).
The Philippine Statistics Authority reported that although the said increase is lower than the double-digit growth registered last month, payments for imports still went up to US$6.1 billion in August 2015 from US$5.8 billion in the same month last year.
“Merchandise imports growth is expected to maintain its growth momentum until the end of the year. This outcome supports our view that domestic consumption will be the main driver of economic growth, at least in the short term, while the manufacturing sector is seen to remain vibrant,” said Economic Planning Secretary and NEDA Director-General Arsenio M. Balisacan.
Payments for raw materials and intermediate goods, which account for 45 percent of the country’s total merchandise imports, increased by 41.2 percent at US$2.8 billion in August 2015 from US$2.0 billion in August 2014.
Meanwhile, spending for imported consumer goods grew by 19.0 percent to US$1.0 billion in August 2015 from US$865.9 million in August 2014 due to higher purchases of both durable goods (36.4%) and non-durable goods (5.1%).
“Imports of raw materials and intermediate goods as well as consumer goods will provide the boost going forward. Ramped-up importation for these commodity sub-sectors suggests an upward tick in the coming months as the manufacturing sector is expected to increase production in anticipation of increased demand during the holiday season,” the Cabinet official said.
Among the monitored trade-oriented economies in East and Southeast Asia for August this year, only the Philippines and Viet Nam recorded positive imports.
“The onset of the election season in early 2016 is also seen as driver of import growth within the year, particularly of manufactured goods such as paper and similar products, textile yarn, fabrics and made-up articles,” Balisacan added.
On the other hand, the import bill for mineral fuels and lubricants declined significantly by 49.7 percent to US$635.9 million in August 2015 from US$1.3 billion in the comparable period last year. But in terms of volume, the country’s purchases of petroleum crude increased by 33.8 percent year-on-year.
Balisacan emphasizes that the challenging external environment, coupled with severe weather disturbances that can exert upward pressure on the price of commodities, may dampen the country’s growth prospects.
“Thus, the government should remain committed to put in place policies to encourage investments, even those that cater to the domestic market. Similarly, government should also ensure that there is ample supply of commodities, particularly food, to manage risks of inflation due to weather disturbances, thus protecting the purchasing power of consumers,” he said.
With the coming of El Nino, Balisacan said measures to ensure ample food supply include expanding dispersal of drought-tolerant rice varieties to farmers and using appropriate technology and providing technical support for crop management and crop diversification.