Exports growth slowed to 3.6% in 2013

MANILA, Philippines—The country’s merchandise exports registered a slower growth in 2013 as problems besetting industrialized economies tempered global demand.

Despite this, the local manufacturing sector recorded a much faster increase in production last year due to the robust increase in domestic demand, which largely fueled growth of the overall economy.

The Philippine Statistics Authority reported yesterday that exports last year amounted to $53.98 billion, up 3.6 percent from the previous year.

The growth was slower than the 7.6 percent posted in 2012 and was short of the 10-percent official growth target set by the government.

The slowdown in exports growth was due to the contraction in the first semester of demand for electronics, the country’s top export earner. Lackluster income growth in the biggest foreign markets caused demand to focus heavily on basic goods and away from non-essentials, officials said.

Electronics exports, which accounted for $21.83 billion of the total exports in 2013, were down year-on-year by 2.4 percent.

The impact of the shortfall in export demand, however, failed to drag manufacturing output.

In a separate report, the PSA said the volume of the manufacturing sector’s production grew in December to its fastest pace in nearly four years.

Officials attributed this to the robust growth performance of the economy and the improvement in the country’s credit profile that boosted investor confidence.

Manufacturing output jumped by 26.5 percent in December from a year ago, registering the fastest pace of expansion since March 2010.

This brought the average growth in the volume of manufacturing production for 2013 to 14.22 percent, accelerating from 7.5 percent in 2012, the PSA said.

The top two sub-sectors that drove manufacturing growth in December were chemicals and furniture and fixtures, which grew year on year by 231 percent and 186 percent, respectively.

Other manufacturing growth drivers during the month were non-electrical machinery (+60 percent), leather products (+49 percent), tobacco products (+44 percent), transport equipment (+40 percent), rubber and plastic products (+25 percent), fabricated metal products (+21 percent) and electrical machinery (+16 percent).

The Philippine economy grew by 7.2 percent last year, the second-fastest in Asia next to China.

Originally posted: 2:31 pm | Tuesday, February 11th, 2014