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Wednesday, October 26, 2005
Government reduces import, export targets
MANILA - The government cut the country’s export and import targets for this year in the face of the global slowdown in the electronics industry, an economic planning official said yesterday.
“Definitely we will not meet our growth target for imports this year,” Dennis Arroyo, economic planning undersecretary said, referring to the original government target of 10-percent growth in imports this year.
“We have also down-scaled our full-year growth target for exports to six percent from eight percent,” he added.
Imports fell
The National Statistics Office (NSO) said imports in the eight months to August fell 0.2 percent over the same period last year to $29.23 billion.
Imports in August alone rose 10.1 percent from a year earlier to $4.06 billion, but they were mostly due to higher crude oil costs, the NSO said.
Arroyo told financial news service XFN-Asia that the government has not set a specific target for imports this year but that he would not rule out negative growth.
The country’s August trade deficit rose to $603 million compared to the year-ago deficit of $258 million.
This brought the eight-month deficit to $2.87 billion, down from $3.97 billion over the same period last year.
The government earlier reported that exports in August rose 0.8 percent to $3.46 billion while exports for the eight-month period were up 4.1 percent to $26.36 billion.
Inputs
Large amounts of imports to the country consist of raw materials that are used as inputs in the manufacture of semiconductors and other electronic products.
Such products in turn constitute over 50 percent of the country’s exports.
A slump in imports has sometimes been taken as a sign that exports will also fall.
The electronics industry association has slashed its 2005 export forecast by half to about five percent.
Art Young, head of the Semiconductor and Electronics Industries of the Philippines Inc. (Seipi) said that while exports of semiconductors were already up 10.7 percent in the eight months of the year, exports of other electronics products was growing only 2.3 percent.
Hit
The electronics industry was hit hard by the transfer of Toshiba’s laptop manufacturing plant from the Philippines to China in January, Young said.
He recalled that Toshiba imported about 90 percent of its raw materials in making laptops although he did not give a figure.
Despite this setback, Young said Seipi was hopeful of posting double-digit export growth next year amid signs that demand for electronics will recover.
Exports of electronic products reached about $27 billion in 2004, Young pointed out. (AFP)
(October 26, 2005 issue)
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