The Philippines’ trade gap in 2019 narrowed by 14.9 percent as exports grew while imports of goods declined during the year, data released by the Philippine Statistics Authority (PSA) showed.
The National Economic and Development Authority (NEDA), however, said the government needs to step up its efforts against downside risks that could affect the trade sector, such as the outbreak of the 2019 novel coronavirus, especially since China, where the virus started, is one of the country’s top trading partners.
According to the PSA, the balance of trade in goods amounted to $37.05 billion in 2019, 14.9 percent lower than the previous year’s figure of $43.53 billion.
Exports rose by 1.5 percent to $70.33 billion from $69.31 billion a year ago, while imports amounted to $107.37 billion, 4.8 percent down from $112.84 billion in 2018.
Trade Secretary Ramon Lopez said last year’s exports figure was a record high as $70.3 billion in 2019 from $69.3 last year despite external headwinds from the global trade policy uncertainties, geopolitical tensions, and country-specific challenges.
Lopez said the country’s export growth is also the second-best performer among East Asian economies, next to Vietnam. The Philippines, China, and Vietnam were the only three countries that reported positive export performance among 11 trade-oriented Asian economies last year.
For the first time, electronics exports hit $40 billion with a 4.4 percent growth, to date. The sector comprised of 56.9 percent of total exports, with non-electronic products making up the remaining 43.1 percent at $30.3 billion. For non-electronic products, top growers are: mineral products; fruits and vegetables; and travel goods and handbags.
Total trade of goods for 2019 amounted to $177.7 billion, 2.4 percent lower than the $182.15 billion recorded for 2018.
The PSA reported that China was the biggest supplier of imported goods for the year, with a 22.9 percent share of total imports or $24.54 billion.
In terms of exports, the United States topped the list with $11.46 billion or a 16.3 percent share, followed by China and Hong Kong which are tied with a share of 13.7 percent each, or $9.63 billion and $9.62 billion, respectively.
“If the virus persists longer, then it will also weaken the global economic growth and it will affect exports. The impact of the novel coronavirus could escalate if plant closures related to the production of automotive and electronic parts negatively affect the country’s exports receipts as this accounts for about a third of the country’s outward shipments to China,” Ernesto Pernia, socioeconomic planning secretary, said in a statement yesterday.
“While the spread of the virus is a national and global concern, there are still areas of opportunity that the country could optimize to offset possible fallout from the spread of the virus,” Pernia added.
In the near term, NEDA said the production of health and hygiene products could expand both in the domestic and exports markets.
Pernia said the government must encourage foreign firms to increase their investments in or relocate to the Philippines to further strengthen its position in the value chain.
For December alone, the PSA reported that balance of trade in goods posted a $2.48 billion deficit, 40.6 percent lower than the $4.17 billion trade gap recorded in the same month in 2018.
The country’s total export sales in December 2019 amounted to $5.74 billion, 21.4 percent higher than the $4.73 billion recorded a year ago.
Total imported goods meanwhile contracted by 7.6 percent to $8.22 billion in December last year, from $8.9 billion in December 2018.
The total external trade in goods in December 2019 reached $13.96 billion, an increase of 2.4 percent from the $13.63 billion external trade in the same month of the previous year.
