Philippine merchandise exports fell for the fourth straight month in July 2015, declining 1.8% to US$5.3 billion from $5.425 billion in the same period last year mainly due to lower sales from total agro-based and mineral products.
Cumulative exports for the first seven months of 2015 registered a 4.1% decrease from $35.659 billion in 2014 to $34.214 billion in same period of 2015.
“The lower value of outward shipments can be traced to reduced exports of total agro-based products and mineral products, but was moderated by sustained strong performances recorded from manufactured goods, most notably electronics and petroleum,” National Economic and Development Authority (NEDA) Secretary Arsenio Balisacan said in a statement.
The value of total agro-based products fell for the sixth consecutive month in July 2015, declining 24.5% to $322.2 million from $426.7 million in July 2014.
The lower value was traced to lower exports recorded from all commodity segments, particularly fruits and vegetables, such as banana, coconut products, sugar products, and other agro-based products.
“Although agro-based exports account for only 5 percent of the Philippines’ total exports, its implication to the domestic economy is significant as the agricultural sector hosts a sizeable portion of the country’s work force,” Balisacan pointed out. He added that measures to mitigate the impact of the El Niño phenomenon remain important in the near term, which should include crop and work substitution programs.
Similarly, exports of mineral products contracted 47.5% to $228.7 million in July 2015 from $435.9 million in July 2014 due to lower earnings from chromium ore and other mineral products.
These reductions in export values significantly outweighed the higher earnings from copper concentrates (27.4%), iron ore agglomerates (41.4%) and gold (2.5%).
Meanwhile, the lower growth in exports was moderated by higher overseas sales to China, which grew 24.1%, NEDA noted.
Moreover, despite depressed oil prices, Philippine exports of petroleum products reached $78.6 million in July 2015, up 140.7% from the same period last year as exports to Malaysia (270.3%), South Korea (100%), and India (100%) significantly increased.
“Easing commodity prices worldwide could dampen export revenue prospects in the near term, and the outlook for semiconductor exports remains on the downside. Exports of semiconductors are expected to slow down in the fourth quarter of the year owing to weak orders from the EU, China and Japan,” Balisacan said.
The Semiconductor and Electronics Industries in the Philippines Inc. recently again slashed its export targets for 2015 with a maximum growth of 5%, or at worst, to stay flat, as the group expects exports of electronics products to barely grow this year due to the weak global market and the lingering economic woes in China.
“Thus, policies geared towards increasing domestic demand are essential to counter external weaknesses and to ensure that the country’s growth trajectory remains on track,” Balisacan said.
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