Government seen missing 2015 export growth target

MANILA, Philippines - The government will miss its full-year growth target for merchandise exports given the slack in demand from external markets, Socioeconomic Planning Secretary Arsenio Balisacan said.

Balisacan told reporters growth may be flat this year over 2014 levels, far below the seven-percent goal of the government.

He said the weak global activity has reduced demand for Philippine-made goods although improvement is expected in the next few months.

“The external trade as a whole is a bit weaker than initially expected or targeted but the good thing is that the services exports are doing very well and it’s offsetting the rather weak merchandise exports,” Balisacan said.

Latest data showed exports contracted 4.1 percent to $34.21 billion in the first seven months from $35.66 billion in the same period last year.

This was despite a 9.1-percent increase in the shipments of electronic products, which make up about 47 percent or $16.29 billion of the country’s total exports.

Balisacan pointed out the double-digit growth in merchandise imports for June and July should help increase exports for the remaining months of the year.

“This is because looking at the composition of imports, these are the intermediate inputs and capital goods (that will be used for our exports),” he explained.

However, he cautioned external markets remain volatile which means boosting exports numbers would remain a challenge.

“The global markets are still a bit shaky. We haven’t seen the end of the tunnel yet for the Chinese economy on how far it would go down… but it’s good that the US economy (is improving) but there are many other uncertainties out there,” Balisacan said. 

“Hopefully our trading partners will perform well in the coming months so exports will improve,” he added.

The interagency Development Budget Coordination Committee is scheduled to meet early next month to assess the country’s growth and macroeconomic assumptions including trade targets.

Last year, the country saw its merchandise exports climb nine percent to $61.81 billion from $56.7 billion in 2013.