MANILA – – Philippine monetary officials are hopeful of the improvement of the country’s exports this year, which in turn will positively impact on the country’s balance of payments (BOP) position.
“Now that our trading partners are recovering, that will support exports performance in 2018,” said Bangko Sentral ng Pilipinas (BSP) Monetary Stability Sector-in-Charge Francisco Dakila Jr. in a briefing Friday.
Last year, exports grew by 12.8 percent to USD48.2 billion but imports posted a higher expansion of 14.2 percent to USD89.4 billion.
Faster imports growth was attributed to stronger needs for raw materials and intermediate goods and minerals fuels and lubricant on higher domestic demand, due in part to the government’s massive infrastructure program.
Robust imports growth in recent years have resulted in the widening of trade-in-goods deficit, which last year inched up by 15.9 percent to USD41.2 billion.
This resulted in the doubling of the country’s current account (CA) deficit to USD2.5 billion, way higher than the central bank’s USD1 million assumption, from year-ago’s USD1.2 billion deficit.
The BOP position last year ended at a deficit of USD863 million, more than twice the USD420 million a year ago. The central bank’s BOP assumption for last year is USD1.4 billion.
Dakila said the BOP deficit last year had been factored in by economic managers given the national government’s infrastructure program.
“We foresee that the current account will be in deficit this year but not more than 0.2 percent of GDP,” he said.
BSP Department of Economic Statistics Senior Director Rosabel Guerrero said the country’s 2017 CA deficit is the second consecutive year that it was in negative territory after being in surplus since 2003.
In 2016, the CA deficit amounted to USD1.2 billion, she said, citing that this has been revised from the earlier figure of USD954 million.
The CA deficit in 2016 accounted for 0.4 percent of gross domestic product (GDP) based on the sixth edition of International Monetary Fund’s (IMF) Balance of Payments Manual, or BPM6, and is the highest since it hit USD2.875 billion in 1999, which accounted for 3.5 percent of GDP and based on BMP5.
Guerrero declined to give figures for the 2018 assumptions on BOP and other economic data, citing that these are still being assessed.The central bank reviews its annual economic assumptions twice a year – in April-May and in November. (PNA)
