The country’s trade deficit widened as of August from a year ago even as total trade continued to improve, data released by the Philippine Statistics Authority (PSA) yesterday showed.
Deficit ending August totalled $25.25 billion, 60.96 percent higher than the $15.69 billion trade gap recorded in the first eight months of 2020.
As of end-August, total trade reached $123.1 billion, 26.26 percent up from the year ago level of $97.5 billion.
Total trade in August amounted to $16.51 billion, 25.3 percent up from the year ago level of $13.18 billion. In July, the country’s total external trade was higher at $16.63 billion.
Merchandise imports and exports continued to post double-digit growth in August, reversing contractions posted a year ago,
According to the PSA, export sales in August 2021 amounting to $6.47 billion grew by 17.6 percent, from an increase of 13.8 percent in the previous month.
In August 2020, total export sales declined by 12.7 percent due to the impact of the coronavirus disease 2019 (COVID-19) pandemic.
The PSA also reported that total imported goods in August 2021, which amounted to $10.04 billion, increased by 30.8 percent. In July 2021, the annual increase was higher at 29.5 percent, while in August 2020, imports value decreased by 17.5 percent annually.
Thus, the country’s total external trade in goods in August 2021, which amounted to $16.51 billion, grew by 25.3 percent.
In the previous month, the annual increase was recorded at 22.9 percent, while in August 2020, the decline was 15.6 percent.
The balance of trade in goods in August amounted to -$3.58 billion, representing a trade deficit with an increase of 64.1 percent.
The trade deficit in August amounted to $3.58 billion, up by 64.1 percent from the year ago trade gap of $2.18 billion. In the previous month, the trade deficit was recorded at $3.66 billion.
The trade deficit in the previous month recorded a hike of 71.4 percent, while in August 2020, it was at -27.5 percent.
Michael Ricafort, Rizal Commercial Banking Corp. chief economist, said in a statement the Philippine external trade for August 2021 remains a bright spot for the Philippine economy despite the challenges brought about by the COVID-19 pandemic, with exports among record highs (near the record high of $6.8 billion posted in March 2021) and imports also near record highs (or $0.7 billion away from the record high of $10.7 billion posted in October 2018).
“However, higher prices of global commodities could have also led to the higher imports and exports data in recent months,” Ricafort said.
“Some disruptions in the global supply chain for various products such as some electronics/semiconductors and other manufactured products largely brought about by the pandemic since last year would have led to higher demand for Philippine exports, which, in turn, helped spur imports of raw materials, capital equipment, and other inputs for manufacturing,” he added.