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Trade deficit in 2023 revised upward to $52.59 billion

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THE record trade deficit posted in 2023 has been revised upward to $52.59 billion from the $52.42 billion initially reported, the Philippine Statistics Authority said.

The value of merchandise exports in 2023 was revised upward to $73.62 billion from $73.52 billion previously.

Imports were also revised upward to $126.21 billion from $125.95 billion initially reported.

Last year’s export and import performance missed the 3% and 4% full-year growth target set by the Development Budget Coordination Committee.

“Demand for exports dipped as global trade faced a challenging year with trade partners experiencing slower economic growth due to a host of issues such as high inflation, elevated borrowing costs and other geopolitical developments,” ING Bank N.V. Manila Senior Economist Nicholas Antonio T. Mapa said in an e-mail.

Mr. Mapa also added that in the chip industry, lower value-added products have yet to benefit from the high value-added chip AI boom.

“We saw import slowdowns almost across the board with only consumer imports able to grow, mirroring the strong domestic growth fueled by consumption. Energy imports were as expected as the dollar price of imports fell, but what was worrisome was the decline in both capital goods and raw materials, showing the likely negatively impacted investment outlays hindered by the current environment of elevated borrowing costs,” Mr. Mapa added.

“We could see a potential flat year for trade with China possibly rebounding to offset slower demand from other trading partners in Europe and the US. Meanwhile, we will be keeping an eye on the US elections given its potential repercussions on global trade,” Mr. Mapa noted.

The top commodity export was electronics products, which accounted for more than half of total exports, though declining 9.2% to $41.90 billion last year.

The top import commodity was also electronics products, which declined 18.7% to $26.64 billion in 2023.

The US was the top export destination last year, accounting for 15.7% of the total or $11.54 billion. Exports to China accounted for a 14.8%, followed by Japan with 14.2%.

On the other hand, China remained the biggest source of imports with a 23.3% share worth $29.39 billion. Japan followed with an 8.2% share or $10.29 billion, and the US 6.7% and $8.42 billion. — Lourdes O. Pilar