The National Economic and Development Authority (Neda) on Wednesday said the expansion plans of businesses in the Philippines could further boost import growth in the next two quarters.
Socioeconomic Planning Secretary Arsenio M. Balisacan said maintaining the favorable market sentiment, together with an accelerated implementation of reconstruction programs, will be crucial in inducing private-sector investment in capital goods.
“The refleeting program of airline companies, in line with increasing their flight routes alongside the anticipated rise in purchases of power-generating sets to augment the power supply in the country, is expected to boost imports of capital goods,” Balisacan said.
Data showed the country’s merchandise imports posted a slower 3-percent growth in April 2014 on the back of a near-20-percent drop in the country’s importation of capital goods, needed for long-term use of businesses in the country.
In March 2014 merchandise imports in-creased by 10.6 percent.
In April 2014 the country’s import receipts reached $1.179 billion, slightly higher than the $1.473 billion recorded in April 2013.
This pushed the import bill for the first four months of 2014 to $21.53 billion, 9.9-percent increase from the $19.59 billion in the same period of last year.
Payments for inward shipments of Capital Goods, accounting for 22.2 percent of the total imports, declined by 19.9 percent to $1.179 billion in April 2014 from $1.473 billion in April 2013.
Capital goods refer to heavy equipment that require a considerable investment from companies acquiring them. However, these goods are essential for production and can be used for long periods of time.
“Imports growth in April 2014 was due to higher payments for imported raw materials and intermediate goods, mineral fuels and lubricants and consumer goods. However, lower importation of capital goods slowed the increase in the value of imports,” Balisacan said.
In terms of commodity imports, the country’s top import for April was Mineral Fuels, Lubricants and Related Materials which accounted for 27 percent of the country’s total imports.
Imports of the commodity amounted to $1.433 billion. It increased by 11.5 percent over last year’s figure of $1.285 billion.
The country’s traditional top import, Electronic Products, only accounted for 19.5 percent of the Philippines’s total import for April 2014. It posted a contraction of 3.1 percent to $1.037 billion from the 1.07 billion recorded in April 2013.
Among the major groups of electronic pro-ducts, Components/Devices (Semiconductors), had the biggest share at 14.9 percent of all imported electronic products. It posted a 5.1- percent increase to $791.36 million in April 2014 from $752.76 million in April 2013.
“Aggregate payment for the country’s top 10 imports for April 2014 reached $4.081 billion or 76.9 percent of the total import bill,” the government reported.
The Philippines’s top import source in April were China, which accounted for 15.7 percent of total imports; Saudi Arabia, with an 8.4-percent share; and South Korea, with a share of 8.3 percent.
Written by Cai U. Ordinario