Weak foreign trade weighs on Central Visayas growth

CEBU, Philippines – The weak foreign trade in Central Visayas continued to weigh on the regional economy this year.

In his report during the Regional Development Council (RDC) meeting last Friday, National Economic and Development Authority Regional Director Efren Carreon said foreign trade continued to weaken in the first eight months of the year.

Citing data from the Philippine Statistics Authority, Carreon said export earnings of Region 7 went down 14% from January to August this year to US$2.98 billion from US$3.5 billion in the same period last year.

On the other hand, import earnings in the eight-month period also plunged 32% to US$1.6 billion from US$2.4 billion last year.

Total trade in January-August period decreased 21% to US$4.6 billion from US$5.9 billion last year.

A larger reduction in imports, however, enabled the region to post a positive balance of trade as lesser dollars were taken off the export earnings to cover for imports.

Carreon said volatilities in the global market are likely to constrain and dampen growth of the region's export sector for the rest of the year.

According to NEDA, export performance was affected by difficulties experienced by the region's trading partners such as China and the Eurozone countries which saw demand for the region's exports down.

Nationwide, Economic Planning Secretary Arsenio Balisacan earlier said the lingering sluggish global demand and the slack in industrial activity in the US and China brought down the country's exports.

Philippine exports fell 10.8% in October 2015 to US$4.6 billion from US$5.1 billion in same period last year.

"Exports performance in the succeeding months is also anticipated to remain weak given the slowdown in economic growth of the country's major trading partners," Balisacan said in an earlier statement.

As the global economy remains fragile, Balisacan suggested that export-oriented Philippine firms should recalibrate production and marketing processes to serve the domestic market.

Balisacan further noted there is a significant uptick in Japan's industrial sector which may offset the downward pull from weakness in US and China. (FREEMAN)