Imports rise 3.8% to $4.71B in June

The country’s imports rose 3.8 percent to $4.71 billion in June, a possible sign that industries are bouncing back, the National Statistics Office (NSO) reported yesterday.

Total imports in the first half reached $25.3 billion, a 2.3 percent increase over the same period last year, the NSO said.

Electronic products, largely used as components in the country’s electronics exports, made up 46.5 percent of the June import bill, amounting to $2.188 billion. This was up 8.4 percent over the same period last year.

The import figures brought the June trade deficit to $589 million, 22.9 percent above the year-ago figure.

The trade deficit in the first six months of the year, however, fell 44.7 percent to $776 million.

Analysts see the rise in imports as a sign that the country’s exports are getting stronger after showing some softness earlier in the year.

NEDA officer-in-charge Augusto B. Santos said the import growth for June was powered by the recovery of the electronics sector and local industries’ strong demand for imported goods.

“Imports are a good indicator of where exports are headed,” said Marcelo Ayes, a trader at Rizal Commercial Banking Corp. “We may finally see exports start to recover in the second half of the year.”

More than 40 percent of imports are raw materials used by units of Texas Instruments Inc. and other exporters, whose shipments account for about half of the economy. Accelerating exports may help the government meet its 2007 economic-growth target of at least 6.1 percent from 5.5 percent in 2006.

Exports in June rose 1.6 percent from a year earlier, taking the increase in the first six months of 2007 to 6.6 percent, the most recent government report showed.

Raw materials purchases rose 18 percent to $2.22 billion, accelerating from a 1.4 percent month-earlier increase. Consumer goods imports added 40 percent to $425 million, matching May’s advance.

“We expect import growth to continue to accelerate as the general outlook for the Philippine economy remains favorable,” said Frederic Neumann, a Hong Kong-based economist at HSBC Holdings Plc.

Purchases of capital goods fell 10.3 percent to $1.32 billion, following a 12 percent month-earlier decline. Fuel and lubricant imports dropped 11 percent to $697 million, matching May’s retreat.

The country’s trade deficit expanded to $589 million in June from $479 million a year earlier. The first-half shortfall narrowed to $776 million from $1.74 billion a year earlier.