The Philippines is expected to sustain merchandise trade growth in the medium term following reforms conducive to economic recovery, the Department of Finance (DOF) said.
In an economic bulletin on April 2, the DOF’s chief economist and former undersecretary Gil Beltran noted that despite the Omicron-induced infection spike in January that revived stricter pandemic restrictions, combined exports and imports grew 20.1 per cent year-on-year to $16.8 billion. The value of imported goods at the start of this year jumped 27.5 per cent to $10.7 billion, while exports rose 8.9 per cent to over $6 billion.
“Additionally, total trade for the month was 13 per cent larger than the total recorded in 2019. Imports and exports were 12.3 per cent and 14.2 per cent, respectively, larger than their 2019 levels,” Beltran said.
Pre-pandemic, total international merchandise trade in January 2019 amounted to $14.9 billion and increased to $15.4 billion in January 2020, before the Covid-19 lockdowns. In January 2021, two-way trade fell by more than nine per cent to $13.9 billion amid the prolonged pandemic.
For Beltran, “the country must continue to hedge against the risks posed by Covid-19 through a robust vaccination programme and prudent reopening of the economy to sustain the recovery momentum”.
“Key structural reforms such as the recently passed amendments to the Retail Trade Liberalisation Act, the Foreign Investments Act, and the Public Service Act, will play an important role in sustaining the continued recovery of economic activities,” Beltran said.
Ahead of the release of February foreign trade figures on April 8, think tanks and financial institutions projected both exports and imports growth to continue.
On April 1, London-based think tank Capital Economics forecast exports to have grown 10 per cent in February, while imports likely inched up by two per cent.
HSBC Global Research in an April 1 report projected a bigger trade-in-goods deficit of $4.72 billion in February from January’s $4.69 billion, on the back of an estimated 30.9 per cent jump in imports outpacing nine per cent exports growth.
In a report on April 4, Moody’s Analytics said it also expects a larger February trade deficit amounting to $4.9 billion.
But for Pantheon Macroeconomics chief emerging Asia economist Miguel Chanco, February’s trade deficit likely narrowed to $3.5 billion “thanks partly to a stronger Lunar New Year hit to imports”.
“The signal from South Korea’s trade data suggests that export growth leapt to 17 per cent year-on-year – the strongest in six months, while import growth likely continued to cool, to 21 per cent year-on-year” in February, Chanco said on April 4.
For 2022, the government targets 10 per cent goods imports growth, and six per cent expansion in merchandise exports.
PHILIPPINE DAILY INQUIRER/ASIA NEWS NETWORK
