By Chino S. Leyco
The country’s trade deficit further widened in January this year amid the increasing demand for imported goods and slow growth in exports, data from the Philippine Statistics Authority (PSA) showed.
Based on a report by the PSA, total exports were almost unchanged in the first month of the year, growing marginally at 0.5 percent driven mainly by gains in shipments of cathodes, gold, machine equipment, metal components and electronics.
Imports, meanwhile, jumped 11.4 percent during the month with industrial machinery, iron and steel, cereals, electronic products and telecommunications equipment boosted the growth.
Total external trade in January stood at $13.75 billion, with total exports worth $5.22 billion and imports worth $8.54 billion, the PSA data showed.
As a result, the balance of trade stood at a $3.32-billion deficit in January, higher than the $2.47 billion gap in the same period last year.
Amid widening trade gap, the National Economic Economic and Development Authority (NEDA) said the government needs to build the country’s agribusiness sector to push stronger exports industry.
“With the global economy still set for a higher growth trajectory in 2018, the Philippines is off to a good start. However, it is essential for the national government to continue on its initiatives to support exports growth,” Socioeconomic Planning Secretary Ernesto M. Pernia said.
He said that the government is targeting an eight-percent growth in merchandise exports for 2018, supported by a revival of the agribusiness sector.
“To achieve this, the Philippines needs to build up integrated industries that would generate higher value addition, especially for key products such as bananas, cacao, coffee, mangoes, and rubber as well as for other emerging high value crops,” Pernia said.
He added that it is crucial to support large and small producers and develop niche markets such as organic farming to fully harness the potential of the agricultural sector.
In maintaining greater market access, diplomatic posts play a big role by regularly providing relevant information on emerging products that the Philippines can supply to potential markets.
“Moreover, greater market access can be achieved through bilateral and multilateral deals, such as continued exploratory talks of the Department of Trade and Industry with the United States for a foreign trade agreement or an extension of the U.S. Generalized System of Preference (GSP) initiative, which expired last year,” Pernia noted.
Under the US GSP program, around 75 percent of Philippine products may enter the U.S. market duty-free.
Tags: agribusiness sector, electronic products, growth trajectory, imported goods, merchandise exports, National Economic Economic and Development Authority, PH trade gap widens further in January, Philippine Statistics Authority, trade deficit