The trade deficit of Philippines widened to $3.55 billion US dollar in July as imports posted their fastest gain in more than two years while exports barely grew, government data showed.
Trade deficit for July was $3.546 billion versus $3.188 billion in June. The deficit was $1.305 billion in July 2017, according to the government data published on Tuesday.
The country’s imports surged 31.6 per cent in July from a year earlier, owing to large purchases of iron and steel, and transport equipment, industrial machinery and equipment, while exports posted only a negligible growth of 0.3 per cent, reports Reuters.
The central bank has projected an 11 per cent growth in imports this year, driven by demand for capital and consumer goods as the government pushes ahead with its massive programme to build new airports, ports, road networks.
Exports are projected to rise 10 per cent this year.
The Philippines has been posting large trade gaps since last year that have led to wide current account deficits and added pressure on the peso, which has fallen this month to its weakest in more than 12 years against the US dollar.
The peso opened 0.14 per cent weaker on Tuesday while the Philippine Stock Exchange index fell as much as 1 per cent in early trades.
Policymakers have said higher imports reflected a continuing robust expansion of the domestic economy.
The Philippine economy remains one of the fastest growing in Asia, but the slower growth posted in the second quarter increases the challenge for a government that’s funding a multi-billion dollar infrastructure overhaul and a central bank wrestling with high inflation.