Trade gap widens 58% in H1

MANILA, Philippines — The country’s balance of trade in goods recorded a wider deficit in the first semester, nearing pre-COVID levels, with both exports and imports posting strong gains as the economy reopened more than a year into the pandemic, the Philippine Statistics Authority (PSA) reported yesterday.

The country’s trade shortfall reached $18.02 billion from January to June, surging by more than 58 percent from $11.37 billion in the same period last year.

The wider trade shortfall was mainly due to the faster growth in imports of 31.4 percent to $54 billion in the six-month period from $41.08 billion a year ago, reflecting improved economic conditions as business and trade slowly reopened.

The country’s export performance also benefited from the reopening of the global economy, registering growth, although slower, of 21 percent to $35.97 billion.

Overall, external trade in goods in the first half went up by more than  27 percent to $89.96 billion from $70.79 billion a year ago.

Trade figures over the past six months are a reflection of the gradual reopening of the economy and are supported by low base effects, with imports outpacing exports due in part to increased volume of fuel and as crude oil prices rose over the last year.

For the first half, dollar earnings from electronic products, the country’s top export, registered an increase of 18.5 percent to $20.27 billion.

Other export products showed strength during the period, particularly cathodes, ignition wiring sets, other manufactured goods, chemicals and metal components.

The country’s top 10 exports, which cornered 83.4 percent of the total, went up by almost 23 percent to $30 billion during the month.

The country’s shipments  to top 10   export markets reached $29 billion or 80 percent of the total.

The US was the top export destination with shipments worth $5.66 billion or 15.7 percent of the total export pie.

Faster economic recovery in major export markets has been supporting the country’s better rebound, although this was slightly offset by lockdowns and restrictions in other markets.

Meanwhile, inbound shipment of goods and services continued to expand, with the sub-sectors of mineral fuels and lubricants, plastics, food and live animals, and iron and steel leading the growth.

China is still the country’s biggest supplier of imported goods at $13.33 billion, about 25 percent of the total.