Exports climbed 2.2 percent in September from a year ago, the first time since the government declared a community lockdown in March to contain the spread of COVID-19.
The Philippine Statistics Authority said merchandise exports reached $6.22 billion in September, up from $6.08 billion in the same month last year. The figure was also up from $5.5 billion registered in August.
It marked the first time exports posted a year-on-year growth after tumbling 24.7 percent in March, 49.9 percent in April, 26.9 percent in May, 12.5 percent in June, 9.1 percent in July and 12.8 percent in August.
“The export earnings in September 2020 marked a positive growth vis-à-vis the figure from March 2020 to August 2020 in which the value of export had negative growth,” the PSA said in a report.
Data showed seven of the top 10 major commodity groups in terms of value recorded an annual increase, led by cathodes and sections of cathodes of refined copper (133.9 percent); other mineral products (73.3 percent); and metal components (32.9 percent).
Despite showing signs of recovery in September, the cumulative export earnings from January to September declined 13.8 percent to $45.87 billion from $52.2 billion in the same period last year.
Exports of electronic products continued to be the country’s top export with total earnings of $3.63 billion in September. The amount accounted for 58.3 percent of the total exports during the month.
ING Bank Manila senior economist Nicholas Mapa said exports to China helped the sector post an expansion with outbound shipments up by 43.3 percent “as China’s economy opens up after getting control of the virus.”
Meanwhile, imports fell 16.5 percent in September to $7.92 billion from $9.5 billion a year earlier.
“The value of imports contracted for the 17th straight month in September 2020. In the previous month, the decline was higher at -21.3 percent, while in September 2019, imports decreased by -5.8 percent annually,” the PSA said.
This brought total imports in the first nine months to $61.95 billion, down by 26 percent from $83.7 billion a year ago.
Mapa said the imports’ steepest falls were recorded in fuel (51.4 percent), capital goods (17 percent) and consumer goods (13.8 percent), showing a broad-based downturn in economic activity as the Philippines remained mired in a recession.
The freefall in imports coupled with the surprise gain in exports yielded a narrower trade deficit of $1.7 billion in September, representing an annual decline of 49.9 percent.
Mapa said trade deficit continued to tighten given stark import compression, driven by a broad-based decline in economic activity. He said the sharp contraction in the trade deficit helped the current account swing back into surplus which remained a positive for the peso in the near term.
“However, the sustained downturn in imports of raw materials and capital goods points to a continued deterioration in productive capacity and potential output, which does not bode well for prospects for the economic recovery,” he said.
“We expect the peso to remain supported to close out the year and the change in net exports to be the lone bright spot for the third-quarter GDP release later in the week,” he said.
