Trade gap grows in February as exports drop

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The country’s trade-in-goods deficit widened in February as exports contracted while imports grew at a slower pace, the government reported this morning.

Preliminary data from the Philippine Statistics Authority showed the February trade deficit at $2.788 billion, smaller than January’s deficit of $3.920 billion but bigger than February 2018’s $2.537 billion.

Import payments rose 2.6% year on year to $7.966 billion in February, easing from upticks of 3.6% in January and 13.7% in February 2018.

On the other hand, export sales went down by 0.9% to $5.177 billion in February, versus the 6.7% drop in January and the 1.3% growth recorded in February 2018.

The February reading marked the third straight month of export decline following the contractions of 6.7% in January and 12.2% in December 2018.

To date, merchandise exports contracted by 3.9% to $10.456 billion against the six percent target for this year of the interagency Development Budget Coordination Committee (DBCC), which sets official macroeconomic assumptions and fiscal program.

On the other hand, import of goods grew 3.1% to $17.165 billion on a cumulative basis against the DBCC’s nine percent projection for the year.

Consequently, this brought the year-to-date trade deficit to $6.708 billion, higher than the $5.763-billion shortfall in 2018’s comparable two months.

Electronic products, which make up more than half of the country’s exports, grew by 0.8% to $2.817 billion in February, with semiconductors contributing $2.004 billion, down 2.1% from $2.048 billion a year ago.

The US was the top export market in February with a 17.4% share at $901.86 million, followed by Japan’s 16.1% share at $832.98 million and China’s 12.8% share at $664.81 million.

China was the top source of imports that month with a 20.3% share worth $1.62 billion, followed by Japan’s 10.8% share at $859.65 million and South Korea’s 8.2% share at $657.05 million. — Mark T. Amoguis