June 12, 2019
THE country’s trade deficit dipped to $3.5 billion in April from $3.7 billion in the same month last year, as exports recovered and imports contracted, the Philippine Statistics Authority (PSA) reported on Tuesday.
That month’s deficit, however, remained higher than the $3.1 billion recorded in March.
Data from the state-run statistics agency showed that total export sales in April recovered after four straight months of declines, rising by 0.4 percent to $5.51 billion from $5.48 billion in the same month last year.
Total value of imported goods, on the other hand, slid by 1.9 percent to $9.01 billion from $9.18 billion a year earlier.
A trade deficit exists when a country spends more money annually on imports than it receives from its exports.
The PSA attributed the growth in exports to improved sales of fresh bananas (76.7 percent); gold (36.1 percent); machinery and transport equipment (28.5 percent); coconut oil (18.1 percent; iginition wiring set and other wiring sets used in vehicles, aircraft and ships (14.5 percent); other manufactured goods (4.0 percent); and electronic products (3.0 percent).
The decline in imports, meanwhile, was due to decreases in transport equipment, plastic in primary and non-primary form, iron and steel, industrial machinery and equipment, and telecommunication equipment and electrical machinery.
Total external trade in goods amounted to $14.51 billion, down 1.0 percent from P14.66 billion in April last year.
Commenting on the data, the National Economic and Development Authority (NEDA) said also on Tuesday there was a need to continue pushing for the government’s critical legislative agenda to make the country’s export industry more attractive and competitive.
“To further drive up exports , we are looking at continuously increasing market access for Philippine products and reforms to improve productivity and lower production costs,” Socioeconomic Planning Secretary Ernesto M. Pernia said in a statement.
He cited the need to pass amendments to the Public Service, Foreign Investment and Retail Trade laws to support the industry.
According to the NEDA chief, the passage of the Tax Reform for Attracting Better and High-Quality Opportunities (Trabaho) — which seeks to reduce corporate income taxes from 30 percent to 20 percent in 10 years — bill will also modernize the country’s tax regime while streamlining the grant of fiscal incentives.
“With the passage of these reforms, we can leverage the Philippines’ attractiveness to both foreign and local investors. These investments can help our industry to improve production efficiency and product diversification,” Pernia said.
He also said that there was also a need to streamline the issuance of the Food and Drug Administration’s License to Operate and Certificate of Product Registration.
Other interventions that should be in place, he added, include the full implementation of the National Single Window/TradeNet System, and the issuance of the Joint Administrative Order to improve the efficiency in the movement of cargoes and regulate international shipping costs.
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