Philipiine domestic trade falls 60.1 per cent by value in third quarter

MANILA, Nov 26, 2020, BW. Domestic trade declined 60.1% year-on-year by value to P91.19 billion in the third quarter, the Philippine Statistics Authority (PSA) said Thursday, citing preliminary data, Business World reported.

By volume, domestic trade amounted to 2.29 million tons, down 61.6% from a year earlier.

All 10 commodity groups monitored by the PSA posted double-digit drops by value.

Machinery and transport equipment — which accounted for the biggest share of trade by value at 36.1% — posted a decline of 51.5% to P32.94 billion, on volume of 328,236 tons, down 49.6%.

The value of manufactured goods classified chiefly by material also declined 18.1% to P28.73 billion, while volume fell 84% to 208,548 tons.

The biggest decline was posted by miscellaneous manufactured articles, where value fell 98.8% to P142.4 million. Volume also returned the biggest fall at 98.2% to 4,318 tons.

Other commodity groups with more than a 75% drop in trade value for the quarter were: animal and vegetable oils, fats, and waxes (-98.6%); beverages and tobacco (-94.7%); chemical and related products (-85.6%); and food and live animals (-78%).

Northern Mindanao had the biggest surplus of P14.27 billion off outflows of P44.64 billion and inflows of P30.37 billion.

George N. Manzano, University of Asia and the Pacific economist and a former tariff commissioner, said by phone that the domestic trade downturn is largely due to logistical restrictions on the supply side. On the demand side, continued declines in employment and economic output have eroded consumer demand.

“Goods are also sourced by households closer to where they are due to the pandemic,” Mr. Manzano added.

He expects trade to improve in the fourth quarter with higher spending due to the holidays, but warned that this may be subdued due to restrictions on family gatherings next month.

“As we loosen up the economy and restrictions on mobility, domestic trade growth will likely follow,” he said.