The decline in electronics exports in the past several months will pull down the country’s overall exports for the year and cause the economy to grow slower than expected.
Trade Secretary Gregory Domingo said the country’s gross domestic product could grow by just 4.5-5 percent this year instead of the earlier projection of 5-6 percent due to weak export numbers.
“Exports are a big thing, that’s why I’m projecting a slower GDP growth. The worst result was in the second quarter, but third quarter results were still slow. Based on recent inputs, the economy should grow by just 4.5 percent,” he told reporters yesterday.
Even if electronics exports picked up in the last quarter, he said this would not be enough to offset the sector’s dismal performance in the last three quarters.
For the entire year, he said electronics exports might contract by 5-10 percent.
He said total merchandise exports would still register some growth, driven by the strong performance of non-electronics shipments.
According to documents from the National Statistics Office, merchandise exports in July slipped 1.7 percent to $4.43 billion from $4.51 billion in the same month a year ago.
July exports, however, were up 7.3 percent from June’s $4.13 billion. Exports from January to July likewise went up 3.3 percent to $29.19 billion from $28.25 billion in the same period last year.
Electronic products continued to dominate the export mix, accounting for 50.9 percent of total merchandise exports in July. The sector suffered a 21.3-percent decline to $2.25 billion that same month, compared with July 2010’s $2.86 billion.
As with overall merchandise exports, electronics export receipts rose 3.3 percent from June to July.
Other export products, including apparel and coconut products, continued to increase their presence in the export mix, helping cushion the slowdown in demand for electronics.
“Next year will be different. Because we’ll be coming from a small base, there will be growth,” Domingo said.
In an earlier interview, he said the country’s merchandise exports, especially electronics, were expected to go back to levels before the March 11 Japan earthquake by early next year.
Right now, electronics demand remained sluggish as orders from top markets Japan, the United States and Europe continued to be slow.