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The National Authority of Economics and Development (Neda) said Tuesday that the favorable impact of a weak peso on the country's exports and, consequently, on the trade balance, will take a little more time.
The Philippine Statistics Authority (PSA) showed that the country's trade deficit widened to $ 3.7 billion in May 2018, 47.41% more than the deficit of $ 2.5 billion in May 2017.
This increase was 55.12% higher than the $ 10.16 billion deficit of the same period in 2017.
"Merchandise trade increased in May , but imports grew faster than exports, widening the current account deficit "Ernesto M. Pernia, secretary for socio-economic planning, told BusinessMirror Tuesday:" In any case, there is usually a lag before the depreciation of the currency does not favor exports. " In May, the PSA reported 3.8% to $ 5.76 billion in May 2018, up from $ 5.99 billion in May 2017.
The country's exports have not seen growth this year, with the largest decline of 6.8% recorded in March 2018.
Percentage at $ 9.46 billion in May 2018 of $ 8.49 billion in the same month of the previous year.
The president's economic team said that the depreciation of the peso will have a positive impact on the country's exports. On the basis of Central Bank data, the peso has averaged $ 50 to $ 53 per dollar since July 2017.
However, Pernia said it would be difficult to predict how long the lag would be. regarding the benefits of a low peso on the country's exports
"[It] depends on many factors," said Pernia. "[These factors are] essentially exogenous-protectionist policy, trade war."
Exports of Forest Products
The "glimmer of hope" in the latest PSA data, says Pernia, is that the month-on-the-Neda said the contraction in exports In May 2018, merchandise sales slowed to 3.8%, down from 4.9% in April, thanks in part to sustained growth in forest products exports.
in a Neda statement, addressing the cumbersome regulations, strengthening trade facilitation and ensuring better access to trade finance will help improve the country's business climate for exports.
"The recent enactment of the 2018 law aims to reduce bureaucracy and corruption, factors that weigh on economic activity." He added that the Free Trade Agreements [19659003] should also maximize the potential of Free Trade Agreements (FTAs) by facilitating programs that will sensitize industry stakeholders to the benefits of FTAs.
The recent ratification of the Free Trade Agreements (FTAs)
Free-trade agreement between the Philippines and the European Union would boost exports to member states such as Iceland, Liechtenstein, Norway and Sweden – negotiations for the EU-EU FTA should guarantee more permanent preferential rights for Philippine export products in relation to the EU's Generalized System of Preferences [EU GSP+] thus further widening the market base, "said Pernia. In addition, auto parts, coconut, bananas, travel goods and handbags, tuna, carrageenan and activated charcoal are expected to be better exposed as they could become important drivers of growth. exports
of 5.1% to reach $ 15.2 billion in 1945, supported by imports which rose by 11.4% in 1945, after a strong performance of 23.1% in April 2018. [19659003] purchases of mineral fuels, lubricants and related materials, capital goods, consumer goods and raw materials and intermediate goods.
Main Export Markets
The 10 total exports of the country in May 2018 rose to $ 4.68 in May 2018 to 7,37 billions of dollars, or 77.8% of total imports.
The Philippines' top three export markets in May the United States with $ 840.15 million or a 14.6% share of total exports; Hong Kong, $ 796.47 million or 13.8%; and China, $ 761.40 million or 13.2%.
The main import sources of the country were China with $ 1.92 billion, or 20.3% of import payments; Korea, 10.3 percent or an import value of $ 978.61 million; and Japan, 901.27 million dollars or a 9.5% share
Image credits: Nonoy Lacza
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