Philippine exports fell further in May as the weakness in advanced economies continued to pull down global demand for goods and services.
The National Statistics Office on Wednesday reported that merchandise exports reached $4.89 billion in May, down 0.8 percent from $4.93 billion in the same month last year. However, this was slower than the year-on-year decline of 11.1 percent in April.
Exports in May brought the total for the first five months of the year to $21.09 billion, down 6 percent from $22.45 billion in the same period a year ago.
The sustained decline in shipments to foreign markets in May has made the government’s goal of hitting a 10-percent growth in exports for 2013 even more difficult to achieve. So far, however, economic officials have not given up on the target as they bank on the positive projections of the private sector.
“[The 10-percent growth in exports for this year] is still a fighting target. Industry associations are still quite optimistic and keeping their growth projections for 2013,” Economic Planning Secretary Arsenio Balisacan, also the director general of the National Economic and Development Authority (Neda), told the Inquirer.
Balisacan said revenue projections by Filipino exporters remained positive despite the lackluster figure as of May given indicators pointing to a possible increase in global demand in the second semester. These include the gradually improving employment situation in the United States and efforts by Japanese authorities to reverse the deflation in Japan.
Meantime, the government has pointed out that the decline in exports was not a problem exclusive to the Philippines as other emerging Asian economies also registered the same downtrend.
The NSO said five commodities that substantially dragged export earnings lower in May were machinery and transport equipment; wiring sets for vehicles, aircraft and ships; articles of apparel and clothing accessories; electronic products, and metal components.
Electronics remained the Philippines’ top export product during the month, accounting for about 35 percent or $1.73 billion of the total receipts. But the amount represented a 9.3-percent decline from $1.91 billion in the same month last year.
The vulnerability of electronics to external shocks is the reason the Philippines has been urged to diversify its exports. Electronics exports from the Philippines are made up largely of intermediate goods used for the production of consumer electronics such as mobile phones and personal computers.
Economists have pointed out that in times of an economic crunch, demand for “non-essentials” naturally decline and purchases become heavily focused on basic goods.
Machinery and transport equipment, another key export product, accounted for 7 percent, or $343.85 million, of the total receipts for the month. This was a 40-percent drop from $577.09 million in the same month last year.
Metal components accounted for $138.07 million of the total, down 1.1 percent from $139.6 million. Exports of articles of apparel and clothing accessories amounted to $128.51 million, down 14.7 percent from about $151 million. Wiring sets contributed $109 million to the total export revenues, down 15 percent from $128 million.
Japan and the United States remained the top two export destinations. Exports to Japan reached $982.29 million, down 13 percent from $1.13 billion last year. Exports to the United States amounted to $607.06 million, down 15 percent from $714.11 million a year ago.