The surprising growth of electronics exports—driven by an expected supply shortfall of electronic products with supply chains still in recovery phase-- narrowed the trade deficit in October this year to only 13.5 percent, coming from a deficit level of 31.73 percent in September.
With electronics showing a surprise growth of 39.6 percent to $5.1 billion last October, the country’s trade deficit narrowed to only 13.5 percent year-on-year to $3.31 billion as against the 31.73 percent deficit recorded in September.
The Philippine Statistics Authority said external trade grew 12.3 percent yoy to $18.7 billion in October faster compared to 11.5 percent annual growth in September.
Broken down, exports improved 20 percent yoy to $7.7 billion in October. Outbound shipments of electronic products, the country’s top export product, rose 39.6 percent annually to $5.1 billion in October.
Imports expanded 7.5 percent compared with a year ago to $11 billion in October on the back of higher inbound shipments of electronic products and costlier oil imports.
Sought for comment, Nicholas Antonio Mapa, senior economist at ING Bank in Manila, noted that the increased exports could prove temporary, the Philippine Star reported.
“Exports got a boost from mainstay electronics although we warn that this rise may be temporary given expectations for slower shipments in the coming months due to global slowdown,” he said.
Mapa added that imports growth was driven by energy imports and consumer demand.
“However, investment related items like capital goods contracted while raw materials saw modest gains suggesting that investment momentum lacks significant momentum,” he explained.
A commentary from China Banking Corp. said exports in October “surprised on the upside” since this was the fastest since June 2021.
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