Imports down by 6.8% to $5.113B in March

THE VALUE of imported goods that entered the country last March fell by 6.8 percent year-on-year to $5.113 billion, mainly due to cheaper oil and raw materials, the government reported Tuesday.

In a preliminary report, Philippine Statistics Authority data showed that the March imports figure was lower than the $5.486 billion recorded a year ago, hence reversing the 10.8 percent increase registered in the same month last year as well as last February’s 10.2 percent growth.

As export revenue worth $5.377 billion outpaced imports, a balance of trade in goods surplus worth $264.1 million was posted in March.

As of the end of March, the value of imported products that came in reached $15.682 billion, down 4.1 percent from $16.348 billion in the first quarter of 2014.

In a statement, the National Economic and Development Authority (Neda) attributed last March’s imports contraction mainly to lower payments for lubricants, mineral fuels and raw materials.

“Most trade-oriented economies in East and Southeast Asia, except for Vietnam, posted a decline in merchandise imports in March. The reduced value of imports primarily from China, South Korea and Singapore contributed to a drag on imports during the period,” Neda explained.

While lower prices as well as demand for mineral fuels and lubricants slashed the value of these imports by 47.3 percent last March, Economic Planning Secretary Arsenio M. Balisacan pointed out that “the low oil-price condition remains favorable to the current balance of trade, particularly for trade-in-goods of the country as global oil prices continue to hover way below $100 per barrel at $51.6 for the first quarter of 2015.”

“The low price of oil prompted an increase in the overall volume of imported crude by 47.8 percent. It is expected that the increase in energy demand during the summer season will further drive imports of petroleum products,” added Balisacan, who is also Neda’s director general.

According to Balisacan, “the low price of imported oil bodes well for the industrial sector, particularly for manufacturing and utilities sub-sectors given their high reliance on oil-based inputs.”

While raw material imports slid 1.1 percent last March, Balisacan noted that importation of capital goods remained robust, posting a 16.6-percent rise that month. The value of imported capital goods also increased by 2.8 percent year-on-year in March.

“The growth in the imports of major commodities, particularly capital goods and consumer durable, shows that the confidence in the economy continues to be strong and bodes well for growth this year and next,” Balisacan said, adding that the strong growth in capital goods importation during the past two months reflects “continuing brisk business activity.”

“The net positive consumer sentiment based on the latest round of consumer expectations survey is expected to continue to drive consumption goods imports in the second quarter,” Balisacan noted.