Imports down 2.1% to $3.11B in January

Imports tumbled by 2.1 percent to $3.11 billion in January, reflecting slower exports of electronic products, the National Statistics Office (NSO) said yesterday.

With exports for the same month up by 15.4 percent to $3.28 billion, there was a trade surplus of $170 million, the NSO said.

Analysts said the continued slowdown in imports was a cause for concern since they directly reflect on the country’s export performance.

According to earlier figures, imports rose 7.5 percent to $40.3 billion in 2004, below the official growth target of 11 percent. For December alone, imports fell 0.9 percent to $3.05 billion.

The country imports almost all of its electronic parts for assembly and export, as well as crude oil, machinery, transport equipment, iron, steel and textiles.

In January, electronic imports, which accounted for 42.6 percent of the total bill, fell 6.8 percent year-on-year to $1.325 billion.

The country’s main exports are electronic products which rely heavily on imported components so the decline in January raises the possibility that overseas shipments could be coming under pressure.

Bank of the Philippine Islands economist Cecilia Tanchoco said imports will likely see flat to slower growth this year as global consumer demand softens while the expansion of the domestic economy also moderates.

She said falling competitiveness of local manufacturers as production costs continue to rise will also contribute to the slump.

"Our trade performance is not expected to be as strong as the past year," Tanchoco said.

"There’s a general consensus of a softening in global demand. On the domestic front, we are assuming that our growth will slow down from 6.1 percent last year to five to 5.5 percent this year," Tanchoco said.

Other top imports for January were mineral fuels, lubricants and related materials with payments worth $409.70 million.

Industrial machinery and equipment, the third top import was worth $134.94 million, or a reduction of 7.2 percent from $145.45 million a year ago.

Iron and steel, accounting for 3.6 percent of total imports, ranked fourth as foreign bill amounted to $113.32 million.

Transport equipment, contributing 3.1 percent of total bill, was the country’s top import for the month with payments placed at $96.49 million or a decline of 5.8 percent from last year’s $102.40 million.

Rounding the list of top imports for January were: metalliferous ores, $74.12 million; textile, $67.25 million; telecom equipment, $63.57 million; and plastics in primary and non-primary forms, $61.47 million.