Philippines posts trade surplus, key imports fall

20 Oct, 2004

The Philippines posted its first monthly trade surplus in six months in August, government data showed on Tuesday, but a fall in electronics imports raised concern that one of the country's main trade engines was slowing.
Exports exceeded imports by $36 million in August, reversing a deficit of $101 million a year earlier and $310 million in July, the National Statistics Office said.
Imports rose 8.9 percent to $3.38 billion from a year earlier but fell from July's tally of $3.42 billion.
Electronics imports, which accounted for 42.5 percent of the total, fell 2.9 percent from a year earlier and 3.3 percent from July to $1.437 billion. It was the second straight month to show an annual fall.
A slowdown in electronics imports, most of which are reassembled for export, is a signal exports will slow.
"Still continuously weak imports on the electronics side, which doesn't bode that well for exports going forward," said Nicholas Bibby, a strategist at Barclays Capital in Singapore.
"Certainly, I don't think we're going to see a marked acceleration of export growth in the coming months this is in line with what we have started to see happening in other countries as well."
The government - battling chronic budget deficits, tax evasion and corruption - has warned that healthy first-half growth in electronics exports may taper off in the second half as a global technology sector recovery slows.
Exports in August, announced earlier this month, were $3.415 billion, up 13.7 percent from a year earlier. The figures are not seasonally adjusted.
The trade deficit in the first eight months was $1.479 billion, 11.5 percent smaller than the same period last year.
Record high oil prices may have pushed up overall imports for the Philippines, which imports nearly all its crude needs, AB Capital analyst Jose Vistan said.
The weak peso, which has been brushing its record low of 56.45 to the US dollar, was likely to keep a lid on imports in the coming months, he added.

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