The Philippines recorded its largest single-month trade deficit last August with imports jumping while exports decreasing for the second consecutive month.
Merchandise export value went down by 2% year on year to $6.410 billion last August. Data shows that in the same month in 2021, the Philippines recorded an 18.9% growth based on the Philippine Statistics Authority (PSA).
After the 4.1% drop in July, this has been the second consecutive month of year-on-year export contraction.
However, in August merchandise imports increased to $12.413 billion or 26%. This is lower than the August 2021 growth of 28.3% but better than the 22.2% of July 2022.
August experienced the fasted imports expansion in two months, beginning with 26.3% growth in June. This was also the 19th consecutive month of year-on-year import growth.
With this, the trade-in-goods deficit went up to $6.003 billion this August, almost double the $3.310 billion of the same month for 2021. This is also bigger than the July $5.989 billion gap.
Total trade increased to $18.823 billion or by 14.8% this August. This is faster than the 11.8% last July but still slower than August 2021’s 24.4%.
In the eight months to August, exports only hit 4.4% year on year, below the Development Budget Coordination Committee’s growth target of 7%.
In the eight months, imports rose to 26% or $92.966 billion, which is well above the 18% full-year target.
Mr. Ronilo Balbieran, an Economist from the University of Asia & the Pacific, has mentioned that the August drop in exports of 2% is better than their 4% contraction.
“If you are a manufacturer/exporter, it will take time for you to actually repurpose or expand your production capacity and production numbers for you to absorb these depreciation levels,” said Mr. Balbieran.