Philippines: Merchandise exports decline in November; import downturn continues
Merchandise exports fell 0.7% in annual terms in November, contrasting October’s revised 0.3% increase (previously reported: +0.1% year-on-year). The downturn was caused by plunging machinery and transport equipment exports and a slowdown in growth in exports of electronic products—which account for more than half of total export revenue (November: +1.4% yoy; October: +7.0% yoy). Moreover, shipments of agricultural goods declined sharply in the month, largely due to falling exports of coconut products.
Imports contracted again in November, albeit at a weaker rate than in October, marking the eighth consecutive decline (November: -8.0% yoy; October: -10.8% yoy). The contraction came on the back of falling imports of raw materials and intermediate goods and mineral fuels.
Consequently, the merchandise trade deficit narrowed to USD 3.3 billion in November from than the USD 4.1 billion shortfall in November 2018, but was wider than October’s USD 3.2 billion deficit.
Commenting on ING’s 2020 trade outlook, Philippines Senior Economist Nicholas Mapa noted:
“In the coming year, we expect the trade gap to widen due to a recovery in imports and a possible drop in export performance. […] Export growth will be hard pressed to rebound from its 2019 performance given the recent drop in imports of raw materials used in electronics exports (down 13% year-to-date), which could point to weak orders for the Philippines’ mainstay electronics export items.”