MANILA, Philippines - Standard Chartered Bank sees Philippine exporters facing more challenges this year amid weak global demand brought about by the economic slowdown in China.
“We expect exports to continue to face challenges in 2016 due to flat growth globally. This may continue to weigh on the Philippines’ trade deficit, which reached the lowest monthly level of $1.9 billion for the past five years in October,” Jeff Ng, regional economist for Asia at Standard Chartered Bank, said.
The country’s exports declined 5.8 percent to $54 billion from January to November last year compared to $57.3 billion in the same period in 2014 due to weak global demand.
Merchandise exports in the first 11 months of 2015 accounted for only 83.1 percent of the government’s target of $65 billion for 2015.
The National Economic and Development Authority (NEDA) earlier said all key commodities registered double-digit declines except for manufactured goods, which posted a 3.6-percent year-on-year increase as shipments of electronic products continued to recover.
Total export receipts from agro-based products were down 23.1 percent to $240.6 million in November on account of lower revenues from fruits and vegetables, as well as fish, unmanufactured tobacco, and natural rubber, among others.
The total value of outward shipments of mineral products also decreased by 25.3 percent or $151.8 million due to lower earnings from copper metal and iron ore agglomerates, while exports receipt from petroleum and forest products plunged by 69.3 percent and 79.5 percent respectively.
“Electronics exports continued to support, although exports of other manufactured products remained weak,” Ng said.
Socioeconomic Planning Secretary Arsenio Balisacan said exporters need to diversify the products and export markets to mitigate the drag in exports performance.
“In light of regional economic integration, the country should also take full advantage of other export markets other than our traditional export destinations,” he said.
Balisacan said the government needs to continue to strengthen efforts to improve competitiveness of local industries to compete with exporters in other members of the Association of Southeast Asian Nations.