MANILA – Merchandise imports increased by only 0.002-percent year-on-year in July 2014, which may be a reflection of a regional phenomenon as majority of the East and South East Asian trade-oriented economies registered decreases in imports, according to the National Economic and Development Authority (NEDA).
Vietnam, Taiwan, and South Korea were the only countries in the region that posted growth in merchandise imports with increases of 16.4 percent, 9.5 percent, and 5.8 percent, respectively.
Payments for Philippine merchandise imports amounted to US$5.5 billion in July 2014, registering an almost nil expansion from US$5.5 billion in July 2013. The small increment was due to year-on-year gains in overseas spending for mineral fuels and lubricants and consumer goods which partially cushioned the contractions in the value of imported raw materials and capital goods.
“The overall performance of merchandise imports is showing signs of mild recovery from its decline of -0.4 percent in May this year. Year-to-date growth is also better than last year’s -1.6 percent contraction. However on a year-on-year basis, it is way below the 8.9 percent growth in 2013,” said NEDA Deputy Director-General Emmanuel F. Esguerra.
For the first seven months of 2014, payments for imports rose by 4.8 percent to US$36.9 billion from US$35.2 billion in the same period a year ago. Given the slower growth of imports relative to the 9.0 percent expansion in merchandise exports in January-July 2014, trade-in-goods deficit narrowed to US$1.7 billion.
Total import value of mineral fuels and lubricants rose by a hefty 20.4 percent to US$1.2 billion in July 2014 from US$1.0 billion in July 2013. In the same period, overseas purchases of consumer goods increased by 10.5 percent to US$779.2 million from US$705.0 million.
“Sharp contractions in the imports of materials and accessories for the manufacture of electrical equipments and other raw materials for production as well as imports of capital goods need to be monitored periodically since they provide signals on future demand conditions on both domestic and external fronts,” said Esguerra.
He added that the lifting of the truck ban may partly ease the problem of port congestion in Manila but the fundamental issue of improving the capacity and efficiency of alternative ports should be addressed.
As for the sources of Philippine imports in July 2014, the People’s Republic of China had the biggest share at 14.2 percent amounting to US$781.9 million. Second was Japan with a share of 8.5 percent, followed by Taiwan (8.3%), United States of America (7.5%), Singapore (6.4%), Republic of Korea (6.4%), Saudi Arabia (6.2%), Malaysia (5.2%), Indonesia (5.1%) and Thailand (4.5%).
The value of imported commodities from major ASEAN trading as explained in this Australian Forex Trading website http://www.forextradingaustralia.com.au/ on forex trading partners represented about 23.7 percent (US$1.3 billion), mostly on capital goods and materials needed for the manufacture of electrical equipment. Meanwhile, the European Union (EU) provided US$609.9 million or about 11.1 percent share of the country’s total import requirements in July 2014.
“It is also important for the government to continue exploring avenues for greater opportunities within the ASEAN region and take advantage of increased economic cooperation among ASEAN countries,” he concluded.