Value of domestic trade falls in 2019

By Carmina Angelica V. Olano, Researcher

THE Philippine economy saw a decline in domestic trade value in 2019 despite a marginal growth in trade volume, data by the Philippine Statistics Authority (PSA) showed.

According to the final results of PSA’s Domestic Trade Statistics in the Philippines released yesterday, the total value of domestic trade declined by 2.9% to P834.72 billion last year from P859.57 billion a year earlier.

By volume, domestic trade inched up by 0.4% to 25.89 million tons from 25.78 million tons previously.

Seven out of the 10 commodity categories monitored by the PSA reported a decline in trade value. Machinery and transport equipment — which accounted for the biggest share of trade in terms of value — fell 2.2% to P270.05 billion. Its trade volume merely grew by 0.5% to 2.53 million tons.

The biggest decline was seen in miscellaneous manufactured articles, whose trade value slid 23.1% to P42.39 billion. Likewise, its volume went down by 26.8% to 946,379 tons.

On the other hand, the value and quantity of trade in “commodities and transactions not classified elsewhere in the [Philippine Standard Commodity Classification]” rose by 161.5% (to P48.49 billion) and 163.1% (to 2.90 million tons), respectively.

The National Capital Region was the top source of commodities in 2019, with outflows amounting to P267.46 billion. It had a domestic trade surplus of P198.11 billion.

Meanwhile, the Central Visayas Region was the top destination of commodities with total inflows reaching P175.72 billion, posting a trade deficit of P26.47 billion.

“2019 economic growth was the slowest since [it started decelerating] in 2016. This, I believe, is a major reason for domestic trade value and volume… to have likely followed the trend,” said UnionBank of the Philippines, Inc. Chief Economist Ruben Carlo O. Asuncion in an e-mail.

Using 2018 prices, the country’s gross domestic product (GDP) growth eased to six percent last year — the slowest since 2011’s 3.9%. Annual GDP growth has also been decelerating since 2016.

“2020 is unfolding to be the most difficult year for economic growth, not just for the Philippines, but the world. With the cratering of domestic consumption and production due to the COVID-19 (coronavirus disease 2019) pandemic, 2020 domestic trade may decline to unprecedented levels,” Mr. Asuncion said.