The Philippines posted a trade deficit of $43.134 billion in 2021, up $18.5 billion from a $24.6-billion gap a year ago, as the 31.1-percent growth in imports outpaced the 14.5-percent increase in exports, the Philippine Statistics Authority said Thursday.
Rizal Commercial Banking Corp. chief economist Michael Ricafort said the 2021 deficit was near the record of the $43.5-billion gap in 2018.
The trade deficit again registered a new record of $5.2 billion in the month of December 2021 against the $2.44-billion gap a year ago.
The balance of trade in goods is the difference between the value of export and import.
Export sales in December 2021 grew 7.1 percent year on year to $6.27 billion, faster than the 6.6-percent increase a month ago. In December 2020, total export sales increased at an annual rate of 1.8 percent.
The figure brought the full-year exports to $74.64 billion, 14.5 percent higher than the annual total export value earned in 2020.
By commodity group, electronic products continued to be the country’s top export in December 2021 with total earnings of $3.67 billion. They accounted for 58.5 percent of the total exports during the period.
Imports in December 2021 hit $11.48 billion, 38.3 percent higher year on year. In November 2021, the annual increase was lower at 36.8 percent, while in December 2020, imports value decreased by -4.7 percent annually.
The total import value for the full year amounted to $117.78 billion, 31.1 percent higher than the annual total import value of $89.81 billion a year ago.
Most of the imported goods were electronic products with an import value of $2.71 billion or a share of 23.6 percent to the total inbound shipments in December 2021. They were followed by mineral fuels, lubricants, and related materials, valued at $1.67 billion (14.5 percent); and transport equipment which amounted to $927.75 million (8.1 percent).
Ricafort said the new record trade deficit on a monthly basis of $5.2 billion in December 2021 was largely brought about by the further re-opening of the economy.
He said these led to increased economic and business activities that resulted in higher importation activities “as well as elevated global oil prices among 7-year highs and prices of other global commodities among decade highs, thereby bloating the country’s import bill and trade deficit… “
Ricafort said disruptions in the global supply chains would present opportunities for some Philippine exporters to service increased demand amid improved recovery prospects for the world economy and trade. Julito G. Rada
However, he said the increase in new COVID cases in January 2022 that led to more restrictions and higher Alert Level 3 (from 2) in Metro Manila and in many cities and provinces could potentially slow down business and economic activities and also on some importation activities, especially after the seasonal increase in demand including importation during the holiday season in December 2021.