PH ranks 1st in East, Southeast Asia for June imports growth

MANILA, Philippines – After 3 consecutive months of contractions, Philippine imports recorded their highest growth for 2015 at 22.6% in June, the National Economic and Development Authority reported Tuesday, August 25.

The Philippines also ranked first among monitored economies in East and Southeast Asia in terms of imports growth in June 2015.

Except for Vietnam, all these countries registered a decline in imports for the said period.

The Philippine Statistics Authority (PSA) reported Tuesday that the spending for imported goods rose to $5.9 billion in June 2015 from $4.8 billion in the same month last year.

The recovery was due to significant increases in imports of raw materials and intermediate goods (49.2%), capital goods (23.8%), and consumer goods (13.1%), which made up for the continuing decline in the import value of mineral fuels and lubricants (-21.9%).

Accounting for nearly half (48.9%) of the country’s total imports, payments for raw materials and intermediate goods posted a positive turnaround, after declining for 3 consecutive months, at $2.9 billion in June 2015 from $1.9 billion in June last year.

Socio-economic planning secretary Arsenio M. Balisacan said the significant surge of import payments signals improvement in the external environment.

“The increase in importation of raw materials leads us to expect a sustained growth of domestic production while the acquisition of capital goods indicates positive investor confidence,” he said.

Robust spending

Imports are goods or services brought from one country to another. The higher value of imports entering a country (as against the value of exports) results in a more negative balance of trade for that country.

For June, payments for imported capital goods continued to pose a double-digit increase for 5 successive months at $1.3 billion in June 2015 from $1.1 billion from the same month in 2014.

“The country’s continued robust spending on imported capital goods, particularly office, electrical and telecommunications machines and equipment, bodes well for the growth in capital formation,” Balisacan added.

Overseas spending for consumer goods grew at $807 million in June 2015 from $713.4 million in June 2014 due to the increased payments for durable goods, particularly for passenger cars and motorized cycle, which reflects an upbeat performance of the country’s automotive industry.

According to the Chamber of Automotive Manufacturers of the Philippines and Truck Manufacturers Association, a total of 9,840 passenger cars were sold in June 2015 – 19% higher compared to the 8,278 units sold in the comparable period last year.

Balisacan said that for the remaining months of the year, domestic demand is expected to prop up imports growth, despite an anticipated slack in consumer activities during the third quarter of 2015 due to low seasonal demand for consumer goods.

“The recovery of government spending should keep imports afloat, particularly on imported capital goods,” he said. – Rappler.com