Philippines trade deficit widens as September exports hit five-year growth high

Traders Union
All News
Economic Data
Philippines trade deficit widens

Highlights

Philippines' trade deficit widens to $5.15 billion in September, up from $4.67 billion a year earlier, as exports and imports hit record highs.
Merchandise exports jump 35.6% to $9.87 billion, led by a 72% surge in electronic goods and an 86.1% rise in semiconductor shipments.
Strong import growth, especially a 56.8% rise in raw materials and 87.4% in electronics, increases external pressures and could fuel further peso depreciation.

September trade figures and export drivers

As reported by BusinessWorld, citing the Philippine Statistics Authority, the country’s trade-in-goods deficit widens to $5.15 billion in September from $4.67 billion a year earlier and $4.3 billion in August. The September shortfall is the widest since the $6.35-billion deficit recorded in July, and the trade balance remains in deficit for more than a decade.

Merchandise exports soar 35.6% to $9.87 billion in September, the fastest pace since April 2021, while imports climb 25.7% to $15.03 billion. The value of both exports and imports is the highest recorded since the series began in 1991.

Electronic goods, which account for 70.1% of September exports, jump 72% to $6.92 billion, led by an 86.1% surge in semiconductor exports to $5.68 billion. The U.S. remains the top destination for Philippine-made goods at $2.63 billion, followed by Hong Kong, China, Vietnam and Japan.

External pressures and sector implications

Chinabank Research says the record export performance is mainly driven by semiconductors, supported by artificial intelligence-related investment, but it warns that the current chip upcycle may eventually moderate. It also says the faster growth in imports adds to external pressures and could increase depreciation pressure on the Philippine peso.

Francisco Cid L. Terosa, associate professor and former dean of the School of Economics at the University of Asia and the Pacific, says the weaker peso raises the domestic cost of imported fuel and raw materials. In the first nine months of the year, the trade gap widens 25.53% to $47.16 billion as imports rise 20.33% to $121.11 billion and exports increase 17.23% to $73.95 billion.

On the import side, raw materials and intermediate goods surge 56.8% to $6.71 billion, while electronic imports jump 87.4% to $5.8 billion and semiconductor imports more than double to $4.85 billion. Imports of mineral fuels, lubricants and related materials rise 53.3% to $1.97 billion amid elevated energy prices linked to the Middle East war, while Chinabank Research says the modest 1.4% increase in capital goods imports may signal subdued investment demand and weaker household spending.

WTO warnings on conflict-driven trade disruption highlighted how wars in Ukraine and the Middle East are prompting companies to redesign supply chains and shipping routes in ways that could outlast the fighting. Our publication previously noted that these shifts are pushing firms toward costlier but more resilient alternatives, while AI-related demand is helping cushion global merchandise trade even as uncertainty remains elevated.

This material may contain third-party opinions, none of the data and information on this webpage constitutes investment advice according to our Disclaimer. While we adhere to strict Editorial Integrity, this post may contain references to products from our partners.