Friday, 10 September 2010

RP Exports Post 36% Annual Gain in July

By Cris Larano (Dow Jones)
Manila Bulletin

Philippine July exports surprised on the upside, rising 36% from a year earlier and extending a recovery that started last November on the back of a rebound in electronic shipments--a development that bodes well for sustained robust growth of the domestic economy, at least into the third quarter.

Economists, however, note that easing sales of personal computers abroad and a slowdown in June imports--primarily raw materials for export--suggest growth in Philippine exports could slow in the months ahead.

The National Statistics Office reported Thursday that exports in July increased to $4.50 billion, from $3.31 billion in July 2009, but are down from June's $4.56 billion --the highest single-month tally since October 2007 when exports totaled $4.66 billion.

Shipments of electronic products, the country's main export item, rose 49% in July to $2.86 billion, from $1.92 billion in the year-earlier period, but were just shy of the $2.90 billion posted in June.

Double-digit growth was also reported in July for exports of copper cathodes, coconut oil, woodcrafts, ignition wiring sets and metal components.

In the seven months to July, exports totaled $28.22 billion, up 37% from the $20.54 billion recorded in the year-earlier period. "July exports surprised on the upside, with the main thrust stemming from electronics shipments," said Radhika Rao, an economist at Forecast Pte Ltd.

"While it is too early for the pullback in June imports to feed through to the export channel, nonetheless in the light of other leading indicators for the electronics sector, we expect exports to remain supported in the second half with the interim softness in raw materials and intermediate demand attributable to inventory adjustments and fresh orders being fulfilled from existing stocks," she added.

She said export growth of over 25% in the second half is still possible, even with the slowdown.

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