Exports surge 20% to $35.9 billion to exceed pre-pandemic level

Merchandise exports jumped 20.9 percent in the first six months to $35.9 billion from $29.7 billion in the same period last year, exceeding the pre-pandemic level of $34.6 billion registered in the first half of 2019, data from the Philippine Statistics Authority show Friday.

The Department of Trade and Industry attributed the growth to the reopening of the global markets like the US, China and the European Union, and the policy to keep the export operations at full capacity despite the lockdowns.

Consumer spending is also on the rise, gaining confidence brought about by the increase in mobility and a gradual return to an almost back to pre-pandemic level of economic activity.

“We are seeing an increasing shift of economic growth in Asia, and the Philippines is ready to participate in that growth. With the reopening of more economic activities and more aggressive vaccination rollout in the country, our balanced and calibrated approach manifested a continued strong export performance,” Trade Secretary Ramon Lopez said.

“We are positive that we will continue to see an upward movement in our export performance, as we allow 100-percent operating capacity of our exports sector even during the Enhanced Community Quarantine. In our efforts not to disrupt export activities, we expect to maintain the acceleration of our growth rate and continue to provide jobs for our people. There is still room for more growth for PH exports,” Lopez said.

The PSA said that in June, exports and imports registered double-digit growth from a year ago, reflecting improved economic conditions this year relative to 2020 when successive lockdowns were imposed by the government to curb the spread of the COVID-19 pandemic.

Exports sales in June grew by 17.6 percent to $6.51 billion from $5.53 billion a year ago, although this was slower than the increase of 30.8 percent in May. In June 2020, total export sales fell 10.1 percent.

Merchandise imports amounted to $9.33 billion in June, up 34.2 percent a year ago. In May, the annual increase was higher at 55.6 percent, while in June 2020, imports decreased by 20.8 percent annually.

Total imports value from January to June reached $53.34 billion this year, up by 29.8 percent from $41.08 billion in the same period last year.

Data showed that as exports outpaced the growth in imports, the trade deficit widened to $17.4 billion in the first six months from $11.3 billion last year. In June, the trade deficit hit $2.8 billion.

ING Bank Manila senior economist Nicholas Mapa said exports and imports posted faster-than-expected growth in June.

“Strict mobility restrictions imposed in the first quarter slowed economic considerably, affecting both outbound shipments of goods as well as demand for imports. The overall June trade balance settled at -$2.83 billion, wider than the average trade deficit in 2020 of $2.0 billion, which could be enough to push the current account back into deficit for the month,” Mapa said.

Mapa said these trends may reverse as early as August with the implementation of a stricter two-week enhanced community quarantine restrictions in Metro Manila and adjacent provinces from Aug. 6 to 20 after confirming the spread of the deadlier COVID-19 delta variant in the country.

“Should these curbs persist past the two-week schedule, we could see overall trade to dissipate in the coming months,” Mapa said.

Data showed that of the 10 major commodity groups in terms of the value of exports, nine recorded annual increases led by copper metal (up 161.1 percent), followed by ignition wiring sets (53.4 percent), and other manufactured goods (40.5 percent).

Electronic products continued to be the country’s top export in June with total earnings of $3.72 billion, accounting for 57.1 percent of the total exports during the month.