Imports surged 39.3 percent in May from a year ago, the fastest in more than two decades, amid robust domestic demand, the Philippine Statistics Authority said Tuesday.
Data from PSA showed merchandise imports hit $6.7 billion in May, up from $4.8 billion in the same month last year. The imports growth was the fastest since it climbed 39.5 percent in January 1994.
Total imports in the first five months also grew 18.2 percent to $31.89 billion from $27 billion a year ago, resulting in wider trade deficit, as exports remained sluggish.
The Philippines posted a trade deficit of $2 billion in May and $9.8 billion in the first five months.
The National Economic and Development Authority said in a statement the increase in local demand for capital and consumer goods drove the imports growth in May.
“The bullish performance of imports is a clear signal that our domestic economic conditions remain robust despite the weak global economy. With its current upward trend, we expect investments and consumption to drive growth for the rest of the year,” said Economic Planning Secretary Ernesto Pernia.
Data showed that among 11 selected Asian countries, only the Philippines posted a double-digit growth of 39.3 percent in May while other countries posted lower imports.
“With the sluggish import activities in the region, we must focus on fast-tracking the country’s infrastructure development to support the growth of our economy and improve our absorptive capacity for investments,” Pernia said.
Neda said imports of capital goods jumped 99.9 percent in May, sustaining its double-digit growth for the ninth consecutive month.
Orders for consumer goods increased 47.2 percent to $1.2 billion, driven by the higher demand for vehicles. Transport equipment imports climbed 108.6 percent to $703.61 million while orders for power generating and specialized machinery grew 96.7 percent to $151.98 million.
“This is consistent with the findings of AmBisyon Natin 2040, which listed car ownership as among the aspirations of the Filipino people. But infrastructure, especially roads, must keep up. At the same time, public transport systems must be improved to expand people’s transport options, while we foster economic development in the countryside. Since these strategies take time to implement, we need everyone’s full cooperation towards efficient traffic management and strict enforcement of regulations,” said Pernia.
He said on the upside, strong domestic demand for vehicles could be a source of growth if companies could participate in the manufacture of the parts and components or even a complete car model.