Philippines Trade Deficit Hits Fresh Record High in January

Philippines reported a trade deficit of USD2.64 billion in January of 2016, as compared to a USD0.86 billion gap a year earlier and missing market consensus. It is the largest trade deficit on record as exports declined while imports rose to the highest in over five years.
PSA l Rida Husna | 3/23/2016 5:20:39 AM
In January, exports dropped by 3.9 percent to USD4.19 billion, the lowest value in almost three years and the 10th consecutive month of decline. Outbound shipments fell the most for articles of apparel and clothing accessories (-46.2 percent year-on-year), followed by chemicals (-34.6 percent), machinery and transport equipment (-22.6 percent), metal components (-14.2 percent) and other manufactures (-5.5 percent). In contrast, sales rose for: pineapple and pineapple products (+90.5 percent), woodcrafts and furniture (+42.0 percent) and ignition wiring set and other wiring sets used in vehicles, aircrafts and ships (+14.5 percent) and copper concentrates (+18.0 percent). Exports of electronic products, the country's top export revenues, also increased by 5.0 percent.

Sales were down to China (-8.6 percent to USD405.65 million, representing a 9.7 percent share of total exports), Singapore (-8.6 percent to USD278.70 million, 6.6 percent share) and the ASEAN countries (-9.5 percent to USD630.02 million, 15.0 percent share). In contrast, outbond shipments rose to the US (+0.7 percent to USD698.85 million, 16.7 percent share), Hong Kong (+2.6 percent to USD438.79 million, 12.3 percent share) and the EU countries (+3.8 percent to USD491.11 million, 11.7 percent share). Exports to Japan, the country's top export destination, also grew by 7.7 percent to USD9350.52 million. 

Imports rose 30.8 percent to USD6.83 billion, the highest growth since November 2010 and the largest value since August 2015. Purchases increased for most of categories except mineral fuels, lubricants and related materials. Imports of metal products rose the most by 73.9 percent, followed by electronic products (+67.1 percent), transport equipment (+61.5 percent), industrial machinery and equipment (+57.6 percent), telecommunication equipment and electrical machinery (+48.2 percent), miscellaneous manufactured articles (+27.1 percent), iron and steel (+25.4 percent), other food and live animals (+14.3 percent) and plastics in primary and non-primary forms (+3.5 percent). In contrast, purchases of mineral fuels, lubricants and related materials declined by 6.8 percent.

Purchases increased from all of the country's main trading partners. Imports from China, the biggest source of purchases for Philippines, rose  38.1 percent year-on-year to USD1.23 billion. Those from Japan increased by 66.4 percent to USD727.04 million, followed by the US (+19.9 percent to USD609.87 million), South Korea (+55.1 percent to USD491.76 million), Thailand (+64.3 percent to USD491.08 million), the ASEAN countries (+28.6 percent to USD1.62 billion) and the EU countries (+24.7 percent to USD673.71 million). 

In December 2015, the country registered a USD0.61 million trade surplus.

 Philippines Trade Deficit Hits Fresh Record High in January