Imports fall in December
According to the Institute for Development and Econometric Analysis, Inc. ( IDEA) latest NewsBriefs, merchandise imports in December 2013 fell by 0.1 percent to USD5.294 billion from the USD5.300 billion recorded in the same period in 2012. On a monthly basis however, imports posted an increase of 1.1 percent from USD5.236 billion recorded in November last year. This brings the aggregate imports last year to USD61.713 billion, posting a 0.7 percent decrease from the USD62.129 billion recorded in 2012.
Per IDEA, the year- on- year decline was influenced by decreases in four major commodity groups. Imports of electronic products fell by 7.3 percent to USD1.196 billion, driven by the 2.9 percent decline in imports of semiconductors. Imports of transport equipment also decreased by 12.1 percent to USD662.07 million while imports of industrial machinery and equipment decelerated by 9.2 percent to USD240.24 million. Imports of feeding stuff for animals ( excluding unmilled cereals), and iron and steel also declined to USD111.36 million and USD114.95 million respectively.
China remains to be the main source of imports of the country, taking 14.7 percent of total imports. The US follows China, accounting for 10.9 percent of total imports. Other major sources were South Korean, Japan, Taiwan, Saudi Arabia, Thailand, Singapore, Indonesia and Malaysia.
Likewise, according to the same published report, First Metro Investment Group expects the gross domestic product ( GDP) growth to hit 7.5 to 8 percent this year. This is higher than the 7- to 7.5- percent forecast set prior to the release of 2013’s fourth quarter GDP. Much of the growth will be influenced by higher government spending on infrastructure, which is estimated to be at PhP404 billion. Higher consumption and investment, and a stronger manufacturing and business process outsourcing sectors is also expected to power growth up.
On the other hand, non- performing loans ( NPL) of thrift, rural and cooperative banks was at PHP45.29 billion from January to September last year. This comprises 7.33 percent of their total loan portfolio and posted a decline from the 7.53 percent recorded in the same period in 2012. NPL however, was higher compared to the levels recorded during the first half of 2013, which was at 7.32 percent. The banks were able to slightly reduce its bad loans despite a 14.5 percent increase in their total loan portfolios.
According to BSP Deputy Governor Diwa Guinigundo, the dollar reserves of the country can cover 11.3 months’ worth of imports, exceeding the 3- month requirement for reserves to be marked adequate. This is in spite of the volatility in the international market. Moreover, the central bank expect that there will be inflows of capital in the country, resulting in less need to tap the currency swap deals. Dollar reserves was at USD78.939 billion last month, falling to its lowest level in 19 months. Despite the decline, the Bangko Sentral ng Pilipinas ( BSP) officials expressed no plans of using its currency swap deals with other Southeast Asian central banks, according to the researchers of IDEA. For comments, rejoinders and questions on credit and collection matters, send email to elimtingco@yahoo.com