June trade deficit widens to record $5.8 billion

The country’s merchandise trade deficit hit another record in June despite slowdowns in annual growth of imports and exports, the Philippine Statistics Authority (PSA) reported on Tuesday.

Preliminary data from the statistics agency showed imports grew by 26% annually to $12.487 billion in June. This was slower than the revised 30.2% in May and 42.4% in June 2021.

The year-on-year increase of imports eased to its lowest in three months, or since the 23.4% in March.

June marked the 17th straight month of imports growth.

Meanwhile, exports inched up by 1% year on year to $6.644 billion in June, slower than the revised 6.4% in May and 18.9% in June last year.

It was the lowest annual growth in 16 months, or since the 1.4% contraction in February 2021.

This brought the balance of trade in goods — the difference between exports and imports — at a record monthly deficit of $5.843 billion in June.

It was wider than the $3.331-billion gap in the same month last year and the revised $5.556-billion deficit in May.

Meanwhile, total trade — the sum of exports and imports — rose by 16.1% to $19.131 billion. The pace of growth was lower than the revised 20.8% in May, and 32% in June a year ago.

In the first six months of 2022, imports grew by 26.7% year on year to $68.320 billion. The growth rate was well-above the economic managers’ upwardly revised 18% target for this year.

Exports likewise rose by 7.1% to $38.527 billion, slightly above the 7% growth target set by the interagency Development Budget Coordination Committee (DBCC) for the year.

Year to date, the trade balance ballooned to a $29.793-billion deficit from $17.953-billion trade gap a year ago.

According to the PSA, import figures for 2021 with reference months June to December except for November and 2022 figures for January to May were revised due to exclusion of duplicate transactions identified by the Bureau of Customs.

It added that these transactions came from the withdrawal of manufactured goods from the freeport zone area. — AMPY