International trade picks up in May

Slower decline reported in exports, imports

MANILA, Philippines — International trade showed signs of recovery in May as the country’s exports and imports rebounded from steep drops in April, the Philippine Statistics Authority (PSA) reported yesterday.

Based on its latest report, PSA said the country’s total merchandise trade in May amounted to $9.84 billion, a 38.7 percent decline from $16.05 billion in May 2019 but slower than the 59.5 percent decline to $6.112 billion in April.

The National Economic and Development Authority (NEDA), which oversees the PSA, said the slower decline in trade performance in May indicates recovery in economic activity.

“Although still negative compared to last year, this represents slight improvements compared to last month,” acting Socioeconomic Planning Secretary Karl Chua said in an online briefing yesterday.

“The slower decline in trade performance is a welcome indication that economic activity has started to pick up with the relaxation of quarantine measures in certain areas, the gradual reopening of business, and the restarting of production in both the country and its trading partners.”

Imports, which made up 59.5 percent of total trade, still outpaced exports  but remained on the decline, dropping by 40.6 percent to $5.85 billion in May from $9.85 billion a year ago, slower compared with the 65.3 percent fall in April.

Exports likewise remained down year-on-year, slipping by 35.6 percent to $3.99 billion in May from $6.20 billion in May 2019 but also a slower decline compared with the 49.9 percent drop in April to $2.83 billion.

Thus, while the country’s trade deficit still narrowed year-on-year in May, this was at a slower pace from April as recoveries in imports and exports were seen, PSA said.

The May trade gap amounted to $1.865 billion, a 48.9 percent decline from $3.649 billion in May last year. This, however, was a slower decline compared with the 88.2 percent drop in April to $448.70 million.

Chua said export of manufactured goods, which accounts for almost 80 percent of total exports, is seen to gradually recover as the latest results of the Purchasing Managers’ Index for the Philippines rose from 40.1 in May to 49.7 in June.

“The Semiconductors and Electronics Industries in the Philippines, Inc. also indicated a gradual pick-up in semiconductors exports in the coming months and projected a flat growth in 2020, notwithstanding the ongoing lockdown in Cebu where some of the electronics firms are located,” he added.

In May, declines were still seen in export sales in eight of the country’s top 10 export commodities. These were ignition wiring sets; manufactured goods; chemicals; electronic products; coconut oil; fresh bananas; gold; and cathodes.

Electronics accounted for 57.4 percent of the country’s export earnings in May.

Top export destinations during the period were Japan, Hong Kong, China, US and Singapore.

With the exception of imports of medicinal and pharmaceutical products  which rose by 23.6 percent in May, inbound shipment values of nine of the 10 major import groups remained on the decline.

These were mineral fuels and lubricants; transport equipment; iron and steel; industrial machinery and equipment; electronic products; plastics; telecommunication equipment and electrical machinery, cereals and cereal preparation; and other food and live animals.

Meanwhile, import value for personal protective equipment  and medical supplies in May 2020 amounted to $32.0 million, an annual increase  of 64.9 percent.

China was the top supplier of imports to the country in May with 21.5 percent share to the total imports during the month.

The others were Korea, US, Japan and Singapore.