Trade deficit shrinks in July

MANILA, Philippines — The country’s trade deficit fell 30.37 percent in July as the double-digit growth in exports offset the decrease in imports, the Philippine Statistics Authority (PSA) reported yesterday.

Total external trade in goods in July 2016 reached 12.22 billion, up 2.2. percent from $11.95 billion in July 2016.

Total exports rose 10.4 percent to $5.28 billion in July 2017 from $4.79 billion in the same month last year.

Total imports, meanwhile, decreased 3.2 percent from $7.16 billion in July 2016 to $6.93 billion in July 2017. This resulted to a $1.65 billion deficit in 2017, lower than the $2.37 billion deficit in July 2016.

Socioeconomic Planning Secretary Ernesto Pernia said exports are expected to continue to grow for the rest of the year as new markets are opened.

“I think it (trade prospects) will be good as exports are doing well,” he told reporters Tuesday. “There will be new export destinations. It (exports) hasn’t slowed down (so far).”

Pernia said the country’s deeper integration to the Asia-Pacific region as well as in its immediate neighborhood, the ASEAN, is expected to boost the country’s trade performance.

“Our country’s trade performance is consistent with the Asian trade growth. We are optimistic that higher growth will be achieved for the remaining months of the year,” he said.

In July, double-digit growth in exports were seen for goods bound for Hong Kong (26.2 percent), Thailand (24.2 percent), South Korea (31.8 percent), Malaysia (31.6 percent), and Vietnam (16.4 percent).

During the same reference period, imports coming from the ASEAN region grew 8.5 percent, boosted by strong growths of inbound shipments from Indonesia (44.3 percent) and Vietnam (50.8 percent).

NEDA said ASEAN member states agreed during the recent ASEAN Economic Community meetings to prioritize the facilitation of trade in goods within the regional economic bloc.

“For the region, this means a chance to double intra-ASEAN trade by 2025. For the Philippines, this means strengthened economic ties with our neighbors and a chance to deepen our partnerships,” Pernia said.

He also noted that the proposed Regional Comprehensive Economic Partnership (RCEP) agreement would provide opportunities for all economies involved. The prospective economic bloc includes the 10 ASEAN member states and six free trade agreement partners that include China, Korea, Japan, Australia, New Zealand, and India.

“This partnership may facilitate more exchange of goods and services, attract investments, create more jobs, and improve the standard of living,” Pernia said.

ASEAN accounts for 21.7 percent of the Philippines’ total trade, while the share of RCEP economies to Philippine trade is 60.5 percent.