The country’s trade gap shrunk in October versus the same period a year ago, as imports posted a double-digit decline while exports posted a flat growth, data released by the Philippine Statistics Authority (PSA) showed.
The PSA yesterday said the country’s balance of trade in goods in October 2019 recorded a $3.25-billion deficit, 26.4 percent lower than the $4.42 billion gap in the same month in 2018.
The country’s total export sales in October was $6.32 billion, which reflected an increase of 0.1 percent from the $6.31 billion total export sales recorded a year ago.
Total imported goods on the other hand contracted by 10.8 percent, from $10.72 billion in October last year to $9.57 billion in October 2019.
The National Economic and Development Authority (NEDA) said exploring alternative production strategies, participating in international trade fairs, and implementing consistent branding strategies are needed to increase the presence of Philippine products in the global market.
The PSA also reported that the country’s total trade in October 2019 amounted to $15.9 billion from $15 billion in the previous month.
NEDA said the slight improvement was brought about by the positive growth rate in exports, but was 6.7 percent lower compared to the same period in 2018.
“The modest recovery in the country’s trade figures for October 2019 backs the expectations that the export sector will remain relatively steady despite the global slowdown associated with the US-China trade war. This also aligns well with the country’s overall GDP growth target of six to seven percent for 2019,” Ernesto Pernia, socioeconomic planning secretary, said in a statement yesterday.
NEDA said trade exports benefited from the uptick in earnings from agro-based products, mainly fruits and vegetables; manufactured articles aided in drawing back the previous month’s decline to register a slight gain in October 2019.
On the other hand, imports decelerated as reduced orders for raw materials and intermediate goods, capital goods, mineral fuels, and consumer goods weakened overall growth of imports, the agency said.
“Possible downside risks, particularly the lingering vulnerabilities and spillovers associated with the trade tensions, need to be managed,” Pernia said.
To counter external risks, Pernia underscored the country’s need to improve competitiveness through the institutionalization of policies and processes that will streamline, facilitate and bring down the cost of doing business, which are important factors in making the country more flexible to any eventualities that may impact the economy.
“We need to take advantage of the country’s capacities on key products and building skills expertise and economies of scale to adapt and harness the benefits from emerging technologies like robotics and artificial intelligence,” Pernia said.
“This will also enable the sector to climb a notch in the global value chain and transition into more value-adding and specialized production,” he added.
Furthermore, NEDA said refocusing market strategies towards capitalizing on design-centric and quality-driven products and employing niche marketing should be done for Philippine products to make its mark in international markets.
“A concerted and targeted effort that will have the support of relevant government agencies to fully implement the interconnection should be prioritized to ensure that our exporters are given the necessary platform to remain at par with the rest of the Asean, besides strengthening our integration within Asean,” Pernia said.