The Philippine merchandise trade grew by 5.1 percent to US$ 15.2 billion in May 2018, backed by imports that rose by 11.4 percent and tempered by the slight decline in exports.
The Philippine Statistics Authority (PSA) reported that the May imports were driven by increased inbound purchases of mineral fuels, lubricants and related materials, capital goods, consumer goods, and raw materials and intermediate goods.
On the other hand, the contraction in merchandise exports slowed to 3.8 percent in May 2018 from 4.9 percent in April, partly supported by sustained growth in exports of forest products.
Among the major commodity groups, only forest products posted gains (77.8%) to register their 19th month of consecutive growth.
Exports of plywood grew by 167.8 percent, with shipments sent mainly to Japan and the U.S. Exports of lumber grew by 49.8 percent, which were shipped mainly to Japan and China. In the five months to May, receipts of forest products totalled US$94.8 million, 98 percent higher than the comparable period in 2017.
Agro-based products, manufactures, mineral and petroleum products continued to register negative growth so that total merchandise exports fell for a fifth consecutive month in May.
Electronic products, which accounted for 64.9 percent of manufactures exports in May, registered a slight gain of 2.3 percent.
Socioeconomic Planning Secretary Ernesto M. Pernia said that addressing cumbersome regulations, enhancing trade facilitation, and ensuring better access to trade finance will help improve the country’s business climate for exports.
“The recent passage of the Ease of Doing Business Act of 2018 should promote trade as it aims to reduce bureaucracy and corruption, factors which weigh down on economic activity. Its timely implementation is needed to improve trade facilitation,” Pernia said.
He added that opportunities from free trade agreements (FTAs) should also be maximized by facilitating programs that will increase awareness of industry players on the benefits of these agreements.
The recent ratification of the Philippines-European Free Trade Association FTA would boost exports to member states such as Iceland, Liechtenstein, Norway and Sweden.
“Successful negotiations for the PH-EU FTA are expected to secure more permanent preferential duties for Philippine export products compared with the EU generalized system of preferences (EU GSP+), thus further expanding market base,” Pernia said.
Vehicle auto parts, coconut, bananas, travel goods and handbags, tuna, carrageenan, and activated carbon should be given better exposure as these could potentially become major drivers of exports growth.