Trade deficit narrows in December but virus outbreak threatens Philippine exports
MANILA, Philippines — The Philippines’ trade gap narrowed in December after exports posted a surprise double-digit growth while imports sagged by more than 7%, the country’s statistics agency reported Tuesday.
Trade deficit in the last month of 2019 stood at $2.48 billion, 40.6% smaller than the $4.17 billion gap registered in December 2018.
Exports surged 21.4% to $5.74 billion in December from $4.73 billion a year ago. Outbound shipments of electronic products, the country’s top export, climbed 24.9% year-on-year during the month.
On the other hand, imports fell 7.6% in December to $8.22 billion on lower purchases of almost all key products except oil.
Commenting on the latest trade data, Nomura economist Euben Paracuelles said he believes the novel coronavirus outbreak is “throwing a spanner in the works" and making the recovery of the electronics sector “less certain.”
“The indirect effect from a slowdown in China as a result of the outbreak could also hurt Philippine exports more significantly,” Paracuelles added.
Among the Southeast Asian nation’s major trading partners, China, which was badly hit by the virus, was the third top destination of Philippine exports in December.
In a statement sent to reporters, Socioeconomic Planning Secretary Ernesto Pernia said the government should step up its efforts against downside risks brought by the SARS-like virus on trade.
“The impact of the novel coronavirus could escalate if plant closures related to the production of automotive and electronic parts negatively affect the country’s exports receipts as this accounts for about a third of the country’s outward shipments to China,” Pernia said.
“While the spread of the virus is a national and global concern, there are still areas of opportunity that the country could optimize to offset possible fallout from the spread of the virus,” he added.
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