By Lourdes O. Pilar, Researcher
LOCALLY TRADED goods sharply fell in the fourth quarter of 2020 as the coronavirus pandemic dampened demand, the Philippine Statistics Authority (PSA) reported on Monday.
Preliminary results from the PSA report on “Commodity Flow in the Philippines” showed the value of goods traded during the last three months of 2020 contracted by 53.5% year on year to P82.19 billion from P176.84 billion in the same period in 2019.
Likewise, the volume of these traded goods fell by 38.8% to 3.17 million tons from 5.19 million tons previously.
Commodity flow, also known as domestic trade, refers to the flow of goods in the country through water, air, and rail transport systems. Almost all of the commodities were mainly facilitated through water transport systems.
All 10 commodity categories monitored by the PSA reported a decline in trade value. Manufactured goods classified chiefly by material, which accounted for the biggest share of trade in terms of value at 32.5%, fell by 6.5% to P26.72 billion. Similarly, its trade volume went down by 38.1% to 567,708 tons.
The biggest decline was seen in beverages and tobacco, which slumped by 84.8% to P1.16 billion. Its volume also went down 70.9% to 30,204 tons.
Only two categories — miscellaneous manufactured articles and commodities and transactions “not elsewhere classified in the Philippine Standard Commodity Classification” — saw increases in trade volume by 75.1% (to 417,921 tons) and 40.9% (940,667 tons), respectively. Their trade value, however, declined sharply by 76.5% (P2.36 billion) and 39.8% (P6.96 billion).
Northern Mindanao was the top source of commodities in the fourth quarter, with outflows amounting to P29.96 billion. It had a domestic trade surplus of P21.09 billion.
Meanwhile, the Caraga Region was the top destination of commodities with total inflows reaching P20.94 billion, and posting a trade deficit of P19.24 billion.
“[D]omestic demand was still subdued due to the COVID-19 (coronavirus disease 2019) pandemic. Moreover, much of economic activity is still reeling from the crisis of consumer and business confidence decline, and the economy is still suffering from restrictions hindering more regular movement of people, goods and services,” UnionBank of the Philippines, Inc. Chief Economist Ruben Carlo O. Asuncion said in an e-mail.
Mr. Asuncion added the pace of economic recovery is largely dependent on the government’s vaccination program.
“If the vaccine plan indeed gets rolled out, recovery prospects, and thus domestic trade, are expected to improve in the next quarters to come,” he said.
The Philippines finally began its COVID-19 vaccination program on Monday, with health workers inoculated with vaccines donated by China.
However, the number of infections continues to rise. On Monday, the Health department reported 2,037 new cases, bringing the total to 578,381.
The government is targeting to inoculate 70 million, but the delivery of other vaccines has been delayed.
Read More: Domestic trade of goods plunges in Q4