PH’s business activity continues to recover – DOF
Business activity in the Philippines continues to show an upturn, the Department of Finance (DOF) said, but the government should always remain vigilant about the prevalence of the highly transmissible Delta variant.
In his latest DOF Economic Bulletin, Under Secretary of Finance and Chief Economist Gil S. Beltran said the country’s foreign merchandise trade increased for the fifth consecutive month since March 2021, showing continued economic recovery.
In July, foreign trade totaled $ 16.1 billion, up 19% from a year ago. The value of imports was registered at $ 9.7 billion, an improvement of 24%, while exports amounted to $ 6.4 billion, also up 13 year-on-year.
In the first seven months, total merchandise trade reached $ 106.1 billion, up 26% from the same period last year. This figure is also 0.4% higher than the figure recorded during the same period in 2019, the last normal year before the pandemic.
The year-to-date export value of $ 42.4 billion was also 3.8 percent above its pre-pandemic level, while cumulative total import revenue of $ 63.7 billion. were 1.8% below the 2019 level.
“The arrival of additional vaccines and the intensification of the vaccination campaign for economic frontliners and Filipinos will help the Philippines maintain the gains in the control of the virus and pave the way for economic recovery,” Beltran said.
However, Beltran also said the government will continue to be vigilant and stand ready to respond to the additional risks posed by the coronavirus with the appropriate management measures, lest the green shoots in the economy be completely eradicated.
In August, the Manufacturing Purchasing Managers Index (PMI) was recorded at 48.6 and 46.4 by the Philippine Institute of Supply Management (PISM) and IHS Markit, respectively.
According to Beltran, this was the first time the PISM Manufacturing PMI fell below 50 this year.
“This contraction is likely due to the stricter quarantine measures imposed on the National Capital Region and its surrounding regions during the month in an attempt to curb the surge in COVID-19 infections in the region,” Beltran said .
On October 1, Shreeya Patel, IHS Markit economist, said manufacturers welcome the easing of some virus-related restrictions in the Philippines as a number of factories and companies resumed operations in September.
Patel, however, said the environment for domestic and international demand remains difficult.
“The job cuts persisted, but anecdotal evidence showed that they were mostly voluntary. Nonetheless, arrears have fallen sharply, which could lead to efforts to curb spending and downsize until demand for Filipino manufactures improves, ”Patel said.
“Global shortages have also weighed on the sector with prices rising sharply. Unfortunately, businesses will have to put up with the disruption as supply pressures show no signs of abating, ”she added.
On a positive note, Patel said the vaccination effort supported optimism, and with the government securing more doses, the Philippines appears determined to vaccinate the population.
SUBSCRIBE TO THE DAILY NEWSLETTER
CLICK HERE TO JOIN