PH exports gain momentum in July despite global trade war

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(FILE PHOTO)

Metro Manila (CNN Philippines, September 10) — Philippine exports maintained its climb for the fourth straight month in July, with the National and Economic Development Authority (NEDA) saying demand for locally-made goods remain "resilient" despite trade tensions.

Merchandise exports grew by 3.5 percent in July to hit $6.17 billion, the Philippine Statistics Authority (PSA) said in a report on Tuesday. This improved from the 3.3 percent pickup in June and the 2.3 percent increase in July 2018.

Gold enjoyed the biggest leap for the month, with exports of the precious mineral rising by 81.8 percent. Other export growth leaders were fresh bananas, machinery and transport, electronic parts and equipment, ignition wiring sets, and other mineral products. On the other hand, metal components and chemicals saw exports slip year-on-year, the PSA said.

Electronic products, which account for more than half of export items, expanded by 2.9 percent during the month. This is slower than the 7 percent spike seen the previous year.

Meanwhile, the Philippines continued to scale back on imports, with total inbound shipments down by 4.2 percent. This reversed the 39.8 percent surge in imported goods last year. By value, imports stood at just $9.57 billion in July versus $9.98 billion the previously year.

Raw materials and intermediate goods account for 36 percent of imports, which slipped by more than a tenth in July.

Iron and steel imports were slashed by more than a third. Shipments of mineral fuels, lubricants and similar materials went down by 14.5 percent, while transport equipment saw a 12 percent drop, the PSA said.

Imports of miscellaneous articles, other food and live animals, cereals, and electronic products led the growth during the period.

July saw a $3.39-billion trade gap, the widest since April. Year-to-date, the trade balance stood at a $22.29 billion deficit, as $62.69 billion imports outweighed $40.39 billion exports.

NEDA said export growth was led by higher revenues from agro-based and forest products.

“Philippine exports remained resilient during the second quarter of 2019 despite the continuing external challenges such trade tensions between the US and China, the bleak outlook in Europe, and the uncertainty of the future of Brexit,” Socioeconomic Planning Secretary Ernesto Pernia said in a statement.

Despite this, Pernia admitted that the impact of the trade war is "beginning to show" amid faltering global sentiment. Still, the NEDA chief said local factories can keep growing.

"We are optimistic as we see a reduction of global oil prices, the recent cuts in electricity rates, and the lower import costs due to the appreciation of the peso," Pernia added.