Imports post 11.7% growth in March

CEBU, Philippines - Philippine imports saw an 11.7-percent increase in March fueled by strong domestic demand.

Philippine Statistics Authority reported yesterday that March imports totaled $6.4 billion, up from $5.7 billion in the same month last year and after a decline a month ago.

 "Cumulative imports for January to March 2016 amounted to $18.597 billion and showed an 8.8 percent increase compared with $17.089 billion in same period of last year," PSA said in a statement.

 The Philippines registered a $1.7-billion trade deficit in March, which means it was importing more than exporting. China remained the country's top import source.

 In a statement, Economic Planning Secretary Emmanuel Esguerra said the continued imports growth mirrors the positive prospects of the economy.

 Esguerra noted: “Expected to fuel imports growth in the near term will be the continued expansion of public and private construction, along with investments in durable equipment. Meanwhile, increased employment opportunities with increased government spending for personnel services and maintenance and operating expenditures will contribute to the growth of consumer goods imports."

'Growth  likely to moderate'

In a research note published yesterday commenting on the latest imports data, Singapore-based DBS Bank said: "The robust growth in Philippine imports of capital goods is likely to moderate once the election effect sizzles out and domestic demand normalizes."

 DBS said capital goods have averaged more than 40 percent growth over the past two quarters, well above the 10 percent posted for consumer goods and 5 percent for intermediate goods.

 "Once domestic demand normalizes, as the election effect sizzles out, expects import growth to fall. Which is why the authorities are not too concerned about the trade balance going forward," DBS noted.

 In addition, Esguerra urged the government to improve the state of doing business in the country to support imports growth.

 "This will improve our attractiveness to both local and foreign investors. The passage of the Customs Modernization Act is a step in this direction, as it will reduce opportunities for corruption and technical smuggling," he said. — (FREEMAN)