The Philippines’ import bill in January may have been reduced by 3.8 percent year on year even though the figure may also represent actual growth by as much as 10 percent when compared with that in December, according to DBS Group.
The financial service provider also said in a research note that the import figures would likely mimic the export surge seen in January.
Earlier this month, the National Statistics Office (NSO) reported that exports in January jumped by 21 percent month on month, and by 3 percent year on year.
DBS observed that import figures tend to track export numbers closely, but there has been a divergence in trend over the last three quarters.
The Singapore-based group noted that in the last nine months of 2011, domestic demand had helped to support the overall level of imports while there was a concomitant decline in electronics exports and imports of intermediate electronic products.
“However, this situation has changed when electronics exports surged by 35 percent month on month in January [and] accordingly, we expect imports to increase by 10 percent on a sequential basis,” DBS said.
“But given the high base effect [comparatively high numbers] from last year, headline import growth should still register a contraction of 3.8 percent year on year.”
DBS said the downturn in electronics during the current business cycle could have bottomed out, although a rapid recovery “appears unlikely at this point.”
The group believes that the January export figure reflects inventory restocking to replace supplies used up in the second half of 2011, and may have exaggerated the strength of demand for Philippine goods.
“Amid ongoing concerns about the global economy, the pickup in final demand is likely to be slow, leading to a more measured pace of trade increase (exports and imports) going forward,” DBS said.