Philippines: Exports fall in November; trade deficit remains elevated near record high
January 10, 2019
Merchandise export growth contracted 0.3% in annual terms in November, swinging from the upwardly revised 5.5% expansion registered in October (previously reported: +3.3% year-on-year). The dip was primarily driven by a drop in electronic products exports (November: -1.6% yoy; October: +0.6% yoy)— which account for more than half of total export revenue —due to weaker semiconductor shipments. A sharp contraction in chemical exports also contributed to the decline.
Import growth continued to far outpace that of exports, despite slowing to an eight-month low in November. Imports rose 6.8% in annual terms, a far cry from the 21.4% surge logged in October. Imports of raw materials and intermediate goods; capital goods; and fuels all climbed higher in the month driven by the government’s infrastructure investment push.
All told, the merchandise trade deficit widened to USD 3.9 billion in November from the USD 3.3 billion deficit registered in the same month of the previous year, however it was down from the revised USD 4.1 billion deficit recorded in October 2018 (previously reported: USD 4.2 billion).
Philippines Trade Balance Forecast
FocusEconomics Consensus Forecast panelists expect exports and imports to grow 7.8% and 8.5% respectively in 2019, with the trade deficit widening to USD 40.0 billion. For 2020, the panel projects exports and imports to grow 6.4% and 11.3% respectively and the trade deficit to widen to USD 48.2 billion.
Author: Lindsey Ice, Economist