The Philippines imports nearly all of its crude oil

Import growth slows further in April

MANILA, Philippines (UPDATE) – Merchandise imports grew at their slowest pace in nine months last April on easing demand for electronic products, the National Statistics Office (NSO) reported Tuesday.

Data from NSO showed the country’s import bill amounted to $5.5 billion in April, up 20.3% from the year ago.

Growth, however, slowed from the revised 21.8% in March, and was way below the 49.4% recorded in April 2010. It was also the slowest since July 2010.

A total of $1.69 billion worth of electronic products were shipped into the country in April, equivalent to a year on year growth of 11.5%, which was lower than March’s 36.4% rise. Electronics is the Philippines’ largest import category used as raw materials for exports.

Analysts said imports are expected to decelerate further in the coming months.

“Imports remained strong in April and grew due to elevated oil prices, buoyant private investments on the ground and the impact of supply-chain distortions after Japan’s earthquake, yet to be fully reflected,” said Vincent Tsui of Standard Chartered, Hong Kong.

“We expect trade flows to ease in the upcoming months given Philippines’ manufacturing sector is still dominated by electronic components, and worries about global recovery will moderate external demand for now,” he added.

Radhika Rao of Forecast Pte, Singapore said: “Going forward, stabilization in global commodity prices should see headline imports soften henceforth, though is still expected to outpace external shipments by a sizeable margin on consumption demand, leading to further deterioration in trade account.”

The trade deficit in April was $1.195 billion, bringing the deficit for the first four months of the year to $4.6 billion, nearly double the amount in the comparative period.

The Philippines imports nearly all of its crude oil requirements and is one of the world’s biggest rice buyers.

United States remained the country’s top import source, accounting for 11.1% of total purchases in April, followed by China with 9.5% and Singapore with 8.4%.

Imports from Eastern Asia — the top import source by economic bloc accounting for 33.5% of total shipments — rose 12.9% in April from a year earlier. Southeast Asia and the European Union were the second and third top economic blocs.

The Philippine government has forecast imports to climb 17% to 18%, and exports between 9% and 10% this year. Last year, imports grew 27% and exports by 34%.

Apart from electronic parts and fuel, the country’s other main import items are cereals such as rice, electrical and industrial machinery and transport equipment. –abs-cbnNEWS.com with a report from Reuters