MANILA, Philippines - The Philippines and other East Asian countries should consider selling more consumer goods to China as demand increases tremendously.
“China’s growing demand for imports, especially the consumer goods, presents a new opportunity for the region’s exporters,” said the World Bank (WB) in its bi-annual East Asia and Pacific Economic Update released last week.
The WB noted that China’s imports of consumer goods have been growing rapidly, with emerging East Asian countries currently holding 18 percent of this market.
Its imports of consumption goods grew at an average annual rate of 14 percent in the past 15 years, much higher compared with the world average of only six percent.
Citing the United Nations Commodity Trade Statistics data, the multilateral lender said most countries, including the Philippines, have at least a one-percent share of this market.
Based on CEIC Data Company Ltd. figures, China’s share in world imports has consistently grown since the financial crisis hit developed countries, reaching its share of 10 percent in global gross domestic product (GDP).
China now imports almost as much as the European Union, the world’s largest single market. And as its trade surplus declined, its imports for domestic needs grew faster than imports for processing and re-export, the WB noted.
However, while regional domestic demand is expected to support export growth, this cannot fully compensate for the effects of global slowdown and uncertainty, it added.
As major sources of global demand are slowing, these particularly affect exports of the main production networks in East Asia, mostly electronics. Export demand for commodities and raw materials, however, remained strong.
The WB said some worrisome signs have emerged, referring to the lower exports shipment of Hong Kong SAR to mainland China in September.
“Due to its position at the center of production chains, this could be an indication of rockier times ahead for regional trade,” it said.
With the weakening of global demand, it added that governments in the region should also focus on reforms that would increase domestic demand and productivity.