The technology industry’s traditional cycle of mid-year gadget launches may boost demand for electronics exports, which are the Philippines’ most popular product, a multinational bank said this week.
In a note to clients, American financial giant JP Morgan said local exports might start growing again in the second quarter. This follows a government report that showed that exports had fallen for the third consecutive month in February as demand for electronics slumped.
“There should be some positive payback in the second quarter for the recent weakness,” JP Morgan economist Sin Ben Ong said.
The expected recovery may also “coincide with another anticipated tech product launch in April,” he said.
In February, products shipped by Philippine companies fell by 3.1 percent from the level in the same month last year. Month-on-month, exports were up 1.2 percent.
In the three months ending February, exports were down by 37.1 percent from the previous three-month period, JP Morgan said.
February’s export contraction tracks the performance of most other Asian countries. Only China saw its exports grow in February among major Asia Pacific countries, the National Economic Development Authority (Neda) said.
“This partly mirrors the still fragile global economy, which is particularly reflected in the country’s weak turnout of merchandise exports on the back of lower demand from the country’s major trade partners,” Neda said in a statement.
Apart from lower electronics’ shipments, the government attributed the decline in export receipts to a 20-percent contraction in agro-based export revenue driven by lower earnings from fruits and vegetables, sugar products.
Weaker export conditions in February were likely a result of “payback” from the tech product cycle that lifted shipments at the end of last year, JP Morgan’s Ong said.
Japan remained the top destination of Philippine-made goods accounting for 20.9 percent of total revenue from merchandise exports during the period.