By means of Lourdes O. Pilar, Researcher
THE PHILIPPINES trade deficit fell to the smallest level in three months in November as both exports and imports fell, data showed the statistics ofFice showed.
Preliminary data from the Philippine Statistics Authority (PSA) shows that the country’s trade in goods balance – the difference between exports and imports – stood at a deficit of US$4.767 billion in November, down 0.04% from of the $4.769 billion deficit in November 2023. .
Month over month, the trade gap has narrowed by 17.5% from the revised $5.78 billion in October.
November saw the smallest trade deficit in three months, or since the $4.39 billion gap in August.
Year to date, the trade deficit has widened 3.2% to $49.96 billion, compared to the $48.41 billion deficit a year ago.
In November, the value of exports fell for the third month in a row, down 8.7% year-on-year to $5.69 billion, compared to $6.23 billion a year ago. Exports fell by 8.1% month-on-month.
Exports in November were at their lowest level since $5.57 billion in June 2024.
During the first eleven months, exports amounted to US$67.55 billion, down 0.4% from US$67.83 billion in the same period in 2023.
Meanwhile, imports of goods fell 4.9% – ending four months of expansion – to $10.46 billion in November. This was a reversal from 1.7% growth in November 2023 and the sharpest fall in imports since June’s 7.3% decline.
November’s import value was the lowest level in five months or since $9.89 billion in June 2024.
Year-to-date imports are up 1.1% to $117.51 billion, up from $116.25 billion in 2023.
For 2024, the Development Budget Coordination Committee (DBCC) expects growth of 4% and 2% in exports and imports, respectively.
ELECTRONICS RAID
“Exports were depressed by the performance of soft electronics. Imports fell due to the lower dollar value of energy imports. Meanwhile, capital imports were also lower as a plane order that boosted previous months’ import figures faded in November,” Nicholas Antonio T. Mapa, chief economist at Metropolitan Bank & Trust Co., said in an email.
Manufactured goods, which accounted for the bulk of the country’s total export earnings, fell 12.9% to $4.43 billion in November, compared with $5.09 billion in the same month of 2023.
Electronic products, which account for nearly two-thirds of manufactured goods and nearly half of total exports, fell 20.8% to $2.79 billion in November.
More than two-thirds of total exports were semiconductors, which also fell by 33.1% to $1.91 billion in November.
Exports of mineral products fell 5.6% to $563.17 million in November, while exports of agricultural-based products rose 51% to $456.53 million.
The United States remained the top destination for Philippine goods in November, with exports worth $969.09 million accounting for 17% of total export sales.
It was followed by Japan with $916.12 million (16.1%), China with $786.35 million (13.8%), Hong Kong with $600.24 million (10.5%) and Singapore with $288.11 million (5.1%).
Meanwhile, imports of raw materials and intermediate goods fell 1.9% to $3.849 billion in November, while capital goods fell 3.9% to $2.911 billion.
Imports of consumer goods rose 3.7% to $2.353 billion in November, while imports of mineral fuels, lubricants and related materials fell 24% to $1.3 billion.
By commodity group, electronic products had the highest import value of $2.46 billion in November, up 10.5% from $2.227 billion a year ago.
China was the largest source of imports in November with goods worth $2.82 billion, accounting for 27% of the total import bill.
It was followed by Indonesia with $877.77 million (8.4% share), Japan with $827.75 million (7.9%), South Korea with $774.55 million (7.4%) and the United States with $621.3 million (5.9%).
Sergio R. Ortiz-Luis, Jr., president of the Philippine Exporters Confederation, Inc., said in a telephone interview that many “challenges,” especially geopolitical tensions, affected trade performance in November.
“Electronics exports and imports, which account for 60% of total exports, declined the most due to geopolitical issues. Agricultural products also declined due to slow investment in the country,” Mr. Ortiz-Luis said in a mix of Tagalog and English.
Mr Ortiz-Luis also said the loss of investment, especially from China, was weighing on trade.
“Although investments are on the way, the Philippines is still lagging behind compared to other neighboring countries amid high fuel prices, red tape and some government issues in the country,” he said.
Mr Ortiz-Luis said trading performance has improved but “investments are lacking.”
“We are the last choice of investors who gave more preference to our neighboring countries,” he said.