Imports rise 22.4% in August

Merchandise imports in August rose 22.4 percent from a year earlier to $3.164 billion, raising fears that the country could incur a trade deficit this year, the government said yesterday.

August exports grew 14.1 percent over the same period last year to $2.99 billion, the National Statistics Office said in a statement.

This left the country with a trade deficit of $174 million, a reversal from the $37-million surplus posted in August 2001.

Total exports in the eight months to August rose 7.8 percent from the same period last year to $22.1 billion while exports grew 7.8 percent to $22.85 billion.

This amounted to a trade surplus of $741 million in the first eight months of the year, up 5.3 percent from the same period last year.

DBS Bank regional economist Chee Seng Wong said the trade deficit posted in August could be a sign of trouble for the economy.

"If imports continue to be stronger in the coming months than exports, the result is a continuing trade deficit, which is not healthy for the economy," he told AFX-Asia, the financial news subsidiary of AFP.

The rest of the region was expected to post trade surpluses this year, Wong remarked.

He said a growing Philippine trade deficit "will have a negative impact on exchange rates and this would create strong pressure on interest rates."

Growing imports also indicate the import content of Philippine exports is at "very high" levels, he said.

Electronics and components, used in the country’s export-oriented electronics industry, were the single largest import, amounting to $967.71 million or 30.6 percent of August’s total.

Office and electronic data processing machines were second, comprising 9.9 percent of the total while mineral fuels were third with 7.3 percent.

Japan was the single largest source of imports in August, accounting for $665.44 million or 21 percent of the total.

The United States was second with 20 percent. – AFP