Worldwide slump pulls down Philippine exports

FALLING EXPORTS Hundreds of Japanese and Korean brand cars are parked at the international port in Manila on Thursday, November 10, 2011. Export earnings in September 2011 went down by 27.4 percent to $3.876 billion from $5.341 billion recorded during the same period of the previous year. Month on month, exports fell by 6 percent from $4.123 billion in August. AFP PHOTO/JAY DIRECTO

The country’s export earnings plunged by more than a quarter in September 2011 as shipments of top export electronics were nearly halved from that of the same month in 2010, the National Statistics Office (NSO) reported Thursday.

An industry leader in the electronics sector said in a phone interview that, aside from the so-called base effects reflected in the September 2011 sales, the economic gloom worldwide also affected most export items.

Export sales went down 27.4 percent to $3.876 billion in September from the $5.341 billion of the same month in 2010, the NSO said.

Month on month, exports fell by 6 percent from $4.123 billion in August. Total exports receipts for the January-to-September period declined by 3.1 percent to $37.185 billion in 2011 from $38.362 billion in the comparative nine-month period in 2010.

Each of the country’s top 10 export markets, covering Asia, Europe and the United States, weakened in annual terms—with exports to Singapore, the fourth-largest market, plummeting nearly 77 percent.

Electronics made up 46.8 percent of total export revenue in September, with receipts totaling $1.813 billion. This was 47.9 percent lower than the $3.478 billion registered in September 2010, the NSO said.

On a monthly basis, electronics contracted by 12.6 percent from the $2.074 billion seen in August 2011.

Among the major groups of electronic products, semiconductors had the biggest share with 37.4 percent of total exports. Shipments of semiconductors were halved to $1.451 billion in September from the $2.904 billion of the previous year, the NSO said.

Semiconductor and Electronics Industries of the Philippines Inc. (Seipi) president Ernesto B. Santiago said that September 2010 was “the highest export month recorded in history.”

The comparative dip in the exports of September 2011 was “definitely worse than one’s expectations,” Dr. Benjamin E. Diokno of the UP School of Economics said.

Seipi’s Santiago said that, aside from the “base effect” coming from a good year, industrial spending on electronics was weak because of lingering uncertainty on the future performance of markets abroad.

Also, power rates in Manila remain so high, Santiago said.

“Power takes up a big chunk of costs. If only we can be more aggressive by bringing power rates down, this is our chance to attract new investments so we can expand electronics exports,” he explained.—With a report from Reuters