MANILA – Significant declines in spending for imported raw materials and intermediate goods and mineral fuels and lubricants resulted in a 1.3 percent decline in merchandise imports in August 2014, offsetting the year-on-year gains in consumer and capital goods, according to the National Economic and Development Authority (NEDA).
“Although relatively in better condition than last year, the gradual softening in imports has been observed since the 24.7-percent growth seen last January, steadily sliding to its slowest growth as of August this year. Despite the gains from increased imports of consumer and capital goods, reduced purchases of imported raw materials and intermediate goods and mineral fuels and lubricants dragged down imports growth in August 2014,” said Economic Planning Secretary and NEDA Director-General Arsenio M. Balisacan.
Payments for Philippine merchandise imports decreased to US$5.5 billion in August 2014 from US$5.6 billion in August 2013.
However, the total import payments in the first eight months of 2014 increased by 4.0 percent to US$42.4 billion from US$40.8 billion in the comparable period in 2013. Given the faster growth in merchandise exports at 9.2 percent during the same period, the
narrowed to US$1.7 billion from US$3.5 billion a year ago.
“Domestically, the recent slowdown in imports may reflect market sentiment of sluggish demand due to seasonal factors. But we remain vigilant should this sluggish growth in imports turn out to be a signal of a more pessimistic condition of the global economy, which may spill over locally,” said Balisacan.
The Cabinet official added that the issue on port congestion is still a big threat to imports and exports.
“Although the truck ban has been lifted to ease congestion in Manila ports, cramped port yards remain an issue that may still have an impact on external trade. These should further be monitored and given ample solution to ease the flow of goods traversing Manila ports,” he said.
Meanwhile, payments for imported consumer goods posted a double-digit expansion of 13.8 percent to reach US$766.2 million in August 2014 from US$673.2 million a year ago. Similarly, imports of capital goods grew at a faster pace of 3.1 percent in August 2014 from a marginal increase of 0.3 percent in July 2014, following consecutive contractions since February to June 2014.
“Overall, merchandise imports could possibly pick up in the succeeding months as suggested by the inventory drawdown in the national accounts,” noted Balisacan.
The People’s Republic of China remained as the top source of Philippine merchandise imports in August 2014 with a 14.7 percent share to total import payments amounting to US$806.5 million. Second was United States of America with a share of 7.8 percent, followed by Singapore (7.4%), Taiwan (7.3%), Republic of Korea (7.0%), Japan (6.7%), Saudi Arabia (6.0%), Thailand (5.9%), France (5.3%), and Germany (4.2%).
The value of imported commodities from other ASEAN-member countries accounted for 23.1 percent of Philippine merchandise imports amounting to US$1.3 billion. Meanwhile, the European Union provided US$709.8 million worth of imports or about 12.9 percent of the country’s total import requirements in August 2014.