Imports down by 1.3% in August

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Imports down by 1.3% in August
Reduced purchases of imported raw materials, intermediate goods, and mineral fuels and lubricants drag down imports growth for the period

MANILA, Philippines – A 1.3% decline in merchandise imports has been recorded for August, attributed to declines in spending for imported raw materials, intermediate goods, and mineral fuels and lubricants, the National Economic and Development Authority (NEDA) reported on Friday, October 24.

The decline recorded offset the year-on-year gains in consumer and capital goods, NEDA said.

The gradual softening in imports became evident since the 24.7% growth in January down to its slowest growth in August this year, economic planning secretary and NEDA director-general Arsenio M. Balisacan said.

The country’s merchandise imports registered a flat growth of 0.002% in July, reflective somehow of the regional trend that majority of the East and Southeast Asian trade-oriented economies registered decreases in imports.

IMPORTS DOWN BY 1.3% IN AUGUST. Infographics from the National Economic and Development Authority

Payments for Philippine merchandise imports decreased to $5.5 billion in August 2014 from $5.6 billion in the same period last year.

The total import payments from January to August 2014 increased by 4% to $42.4 billion from $40.8 billion in the same period in 2013.

The trade-in-goods deficit narrowed to $1.7 billion from $3.5 billion a year ago, given the faster growth in merchandise exports at 9.2%.

Payments for imported consumer goods posted a 13.8% growth to reach $766.2 million in August 2014 from $673.2 million a year ago.

Imports of capital goods grew at a faster pace of 3.1% in August 2014 from a marginal increase of 0.3% in July 2014, following consecutive contractions since February to June 2014.

The latest slowdown in imports may reflect market sentiment of sluggish demand attributed to seasonal factors, Balisacan said in a statement.

“But we remain vigilant should this sluggish growth in imports turn out to be a signal of a more pessimistic condition of the global economy, which may spill over locally,” Balisacan added.

But overall, merchandise imports could possibly pick up in the succeeding months as suggested by the inventory drawdown in the national accounts,” Balisacan said.

Port congestion remains a threat

The issue on port congestion is still a big threat to imports and exports, Balisacan said.

Despite the truck ban lifting that started to ease the congested Manila ports, cramped port yards remain an issue that may still have an impact on external trade, Balisacan added.

“These should further be monitored and given ample solution to ease the flow of goods traversing Manila ports,” he said.

For top source of merchandise imports, it is still The People’s Republic of China with a 14.7% share to total import payments of $806.5 million.

Second was United States of America with a share of 7.8% percent; followed by Singapore (7.4%); Taiwan (7.3%); Republic of Korea (7%); Japan (6.7%); Saudi Arabia (6%); Thailand (5.9%); France (5.3%); and Germany (4.2%).

The value of imported commodities from other Association of Southeast Asian Nations (ASEAN)-member countries accounted for 23.1% of Philippine merchandise imports, amounting to $1.3 billion.

The European Union provided $709.8 million worth of imports or about 12.9% of the country’s total import requirements in August this year. – Rappler.com

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