By Cai U. Ordinario
There is little hope for a rebound in the country’s export receipts this year due to the weak global demand, unless Philippine exporters are able to expand their markets, the National Economic and Development Authority (Neda) said.
“Advanced and emerging economies continue to face difficulties. In particular, the slowdown in China due to ongoing structural transformation and the contractionary fiscal policies in oil-exporting countries as they adjust to declining oil revenues pose risks to the Philippine economy this year,” Neda Director General and Economic Planning Secretary Emmanuel F. Esguerra said.
The China-precipitated global gloom and the oil situation already caused a 5.6-percent contraction in Philippine export revenues in 2015. And this is expected to continue, thus, necessitating proactive actions on the part of the Philippines.
“As soft global demand is expected to continue, the challenge is to be able to expand export market destinations and diversify product offerings,” the Cabinet official said.
To boost export growth in 2016, Esguerra said the Philippines should take advantage of the Asean Economic Community and diversify its markets to include India and Mexico, which have been increasing their demand for consumer products.
Further, he said the Philippines should also remain committed to the implementation of the Manufacturing Restructuring Program (MRP) to complement such market and product-diversification efforts.
“Implementing the MRP will rebuild the domestic production base and improve competitiveness through innovation. Given the high multiplier effects and potential for employment generation, the revival of the manufacturing sector is expected to spur domestic employment and investments in the country,” Esguerra said.
In 2015 the difficulties faced by advanced economies affected the country’s export growth. The Philippine Statistics Authority (PSA) said total merchandise exports declined to $58.648 billion in 2015 from $62.102 billion in 2014.
In December 2015 alone, the PSA said the country’s export earnings reached $4.66 billion, a 3-percent decrease from December 2014.
Total receipts from the top 10 exports reached $3.96 billion, or 85 percent of the total exports, up merely 0.3 percent.
Data showed electronic products were the country’s top export, with total receipts of $2.529 billion. It accounted for 54.3 percent of the total export revenues in December 2015. It increased by 6.4 percent from $2.377 billion registered in December 2014. Components/devices (semiconductors) had the biggest share of 36.5 percent among electronic products.
However, semiconductors decreased by 0.8 percent to $1.7 billion in December 2015 from $1.71 billion in December 2014.
“But on a positive note, the Philippines’s major trading partners such as the US, Japan and the Euro area are expected to post a slight recovery this year,” Esguerra said.
PSA data showed that total export receipts from the country’s top 10 market destinations for the month of December 2015 was $3.91 billion, for a share of 83.8 percent.
The country’s top 3 export markets last December were Japan, the US and Hong Kong, which accounted for 20.2 percent, 15 percent and 12.3 percent of total exports in December 2015, respectively.
Exports to Japan amounted to $939.17 million. This, however, decreased by 7.7 percent from $1.017 billion recorded in the same month a year ago.
Shipments to the US reached $697.33 million in December 2015, up 3 percent, while Hong Kong recorded a 17.3-percent growth to $574.85 million.