Imports up 12.5% to $4.68B in Oct

Imports rose in October, after falling in the previous month for the first time in more than a year, as chipmakers boosted purchases of raw materials for electronic products.

Overseas purchases climbed 12.5 percent from a year earlier to $4.68 billion, after a 0.3 percent decline in September, the National Statistics Office (NSO) said in a report yesterday.

Two-thirds of Philippine imports are used to build exported computer parts, disks and other electronic products made by local units of companies such as Texas Instruments Inc. and Toshiba Corp. The government is counting on increased overseas sales to accelerate export growth to 10.5 percent in 2007.

"This is very encouraging," said David Cohen, the Singapore-based director of Asian economic forecasting at Action Economics. "This means exporters still see the electronics market expanding."

Peso bonds and stocks rose on optimism rising imports, particularly purchases of raw materials used to build exports, may signal faster economic growth next year.

Shipments of electronic products may rise less than initially expected this year, World Semiconductor Trade Statistics reported earlier. The trade group cut its sales growth forecast for 2006 to 8.5 percent from 11 percent in May.

Growth in global semiconductor sales slowed for a fourth month in October from a year earlier. Sales rose 9.2 percent, after increasing 9.3 percent in September, San Jose, California- based Semiconductor Industry Association said earlier.

"We’re not feeling a slowdown," Semiconductor and Electronics Industries in the Philippines Inc. Executive Director Ernesto Santiago said yesterday, recalling a meeting of exporters earlier this month.

"There may be a slowdown in the US, but two-thirds of our exports are now going to Asia."

Philippine electronic imports growth quickened to 14.5 percent in October, after a 9.4-percent gain in September, the statistics office said.

October imports of raw materials are used to manufacture exports shipped in November and December, Santiago said in a phone interview.

"Fourth-quarter exports have always been strong," Santiago said. "These imports will be used for exports sold during the holiday season so demand is still strong."

Philippine industrial machinery imports rose 10.1 percent in October, after dropping 10.4 percent in September, on expectation demand will continue to grow in 2007.

Shipments of electronics may rise 10 percent next year, said Arthur Tan, chief executive officer of Integrated Microelectronics Inc., a Philippine maker of computer chips for companies including Toshiba Corp. on Dec. 19. Tan is also president of Semiconductor and Electronics Industries in the Philippines. Electronic exports may average 10 percent in 2006, he added.

"There will be a global slowdown, but we won’t be affected much," Tan said. "If people are buying less cell phones, we can always sell our chips to makers of computers, automobiles or any other product that uses these chips."

The country’s trade deficit for October was $481 million, the NSO said. For the first 10 months of the year, the shortfall was $3.53 billion, compared with $5.44 billion in the same period in 2005.

Mineral fuel and lubricants rose 49.7 percent in October, after slipping 37 percent the previous month. — Aisa Osorio