The value of Philippine exports is forecast to grow by just about half what the government expects with no sign of the anticipated global rebound in electronics, according to the DBS Group.
The Singapore-based bank said in a research note that outbound shipments were “likely to be in the low-to-mid single digits” if a moderate recovery in major markets would happen in the coming months.
The government is looking at exports growth of 10 percent, faster than the 7-percent expansion recorded for 2012 when the Philippines outperformed its neighbors.
DBS observed that exports have been underperforming this year and that, in the first two months, the rebound in electronics did not happen. In fact, electronics exports plunged 34 percent year-on-year during the period.
DBS also expected the drop in exports to slow to 7.5 percent in March from 15.6 percent in February. But the National Statistics Office reported a turnaround, albeit very slightly at 0.1 percent.
Still, electronics exports showed hefty drops of 36.5 percent in February and 22.3 percent in March.
Even then, despite the continued indication of a turnaround in electronics worldwide, DBS said the more important question was whether or the domestic electronics industry was experiencing structural problems.
In February, DBS noted the strong performance of non-electronics such as wood manufactures and machinery and transport equipment although these products had high volatility. “With signs of stabilization in the major economies, and a turnaround in China, exports should provide a boost to growth this year,” the bank said back then.
According to the National Economic and Development Authority, export earnings reached $52 billion in 2012 from $48.3 billion in 2011.
Economic Planning Secretary Arsenio Balisacan said that the 2012 growth figure was below the Development Budget Coordination Committee-approved export growth assumption of 10 percent for the year.
But Balisacan highlighted the December 2012 data, saying that this was the best performance in the East and Southeast Asian regions.
He said the country’s export performance in December reflected the generally improved prospects in the global economy.