DoF orders Customs to reconcile import-export estimates with China

THE DEPARTMENT of Finance (DoF) has ordered the Bureau of Customs (BoC) to reconcile its trade data with China’s in order to get a handle on the extent of smuggling.

The BoC last month reported to Finance Secretary Carlos G. Dominguez III on the discrepancy between official data of the two countries. The differences suggest that China is recording exports goods that are not reflected in Philippine data.

“The (Customs) Commissioner should invite the Chinese bureau of customs chief here. You have to reconcile your figures on the import-export data. Anyway, the difference is not anymore 60%. It’s only 48% now, but that’s still large,” Mr. Dominguez told Customs Deputy Commissioner Edward James A. Dy-Buco during a meeting on Monday.

According to official data gathered by the DoF, the gap between the two countries’ data was about 60% in 2010, 57% in 2015, 48.7% in 2016 and 48% as of the end of July.

In the first seven months of 2017, the Chinese valued exports to the Philippines at $17.77 billion, while Philippine Statistics Authority estimates that imports from the same country of $9.24 billion.

“(The discrepancy) is going down but it’s still large,” Mr. Dominguez said. “These numbers, we’re not sure if they’re apples to apples. The definitive figure will come out from (Commissioner Isidro S.) Lapeña’s sitting down with his counterpart and working it out,” he added.

However, Mr. Dominguez said that the discrepancy may have resulted from timing issues and the inclusion and exclusion of particular commodities in reporting.

The DoF also cited 2014 UN Comtrade World Exports data that showed a total discrepancy of P1.8 trillion between the value of imports as reported locally and the value of shipments to the Philippines by exporting countries.

He said that foregone revenue based on the UN estimate is about P231 billion, equivalent to 2% of the country’s gross domestic product.

Mr. Lapeña has said that the inconsistencies can be attributed to the gross misdeclaration or undervaluation of goods in terms of either volume or weight; and the possible use of “consignees for hire,” where goods are released to “hidden” traders supported by fake documents — which also allows the importer to evade the scrutiny of the Bureau of Internal Revenue. —