Manila eyes weaker trade performance: documents

ABS-CBN News

Posted at Jun 23 2008 10:19 AM | Updated as of Jun 23 2008 06:19 PM

Reuters

The Philippines is planning to revise down slightly its export growth forecast for 2008 and raise its import growth estimate as oil prices continue to rise, official documents showed on Sunday.

Export growth this year is now seen at 5 percent from an earlier downgraded forecast of 6 percent and imports are seen rising 10 percent against an earlier forecast of 7 percent, documents obtained by reporters showed.

"Import growth is price driven due to the elevated price of oil and rice," the documents stated.

The Philippines imports nearly all of its crude oil needs and was the world's biggest rice importer this year after it contracted a total of 2.4 million tons of the grain to offset a shortfall in production.

The new estimates will be presented for approval to an inter-agency committee tasked with setting the country's macro-economic targets.

In the first three months of this year, the Philippines' trade deficit ballooned to $2.1 billion compared to a $181 million surplus a year ago.

Just last month, the government revised down its original 2008 export growth forecast of 8 percent and import growth of 9 percent.

Merchandise exports grew 6 percent last year and imports rose 6.8 percent.

Demand for the Philippines' key electronics and semiconductor exports has been hit this year due to the slowdown in one of its main export markets, the United States.

The central bank has lowered its forecast for this year's balance of payments surplus to $2.5 billion from an original projection of $3.4 billion partly due to expectations of weaker exports.