PHILIPPINE DEFICIT IN TRADE DOUBLES AS IMPORTS SOAR

PHILIPPINE DEFICIT IN TRADE DOUBLES AS IMPORTS SOAR

Growth in exports from the Philippines slackened last year while the country's imports soared, leaving a trade deficit of US$2.6 billion, more than double the 1988 level.

Figures released this week by the national statistics office in Manila show that imports rose almost 28 percent to US$10 billion. That compares with US$8 billion in 1988, a 19 percent increase on the previous year.Exports brought in US$7.8 billion in 1989, a second record year. But that was a rise of 10.6 percent from the 1988 level, compared with a 22 percent jump that year over 1987.

As usual, the largest category of imports was petroleum and products, which last year cost US$1.3 billion, or 13 percent of the total, the figures show. Imports of steel and iron jumped 56 percent, to US$743 million.

Electrical machinery and parts accounted for US$570 million of the total, reflecting continued expansion in the country's industrial sector and its need for equipment.

On the export side, textiles and garments were the top earners, bringing in US$1.5 billion and meeting the government's target of a 10 percent increase on 1988.

The United States is the main garment market, normally taking about 60 percent of the total. Detailed breakdowns of 1989 sales have yet to be released.

Electronics, a sector the government is nurturing, made a strong showing among last year's exports, bringing in US$1.4 billion. At various times during the year, electronics sales surpassed garments and textiles to take top position.

Several large U.S. high-technology companies have manufacturing bases in the Philippines, including Motorola Inc. of Schaumburg, Ill., Fairchild Industries Inc., of Chantilly, Va., and Texas Instruments Inc. of Dallas.

Several Japanese and European firms also operate from the Philippines. NEC Corp. is setting up a US$4.5 million manufacturing plant.

The government is hoping electronics will expand from concentrating on such components as semiconductors into higher value-added services, including the writing of software.

Trade Secretary Jose Concepcion is on record as looking for export earnings of US$500 million by 1992 from software and other data encoding. Software is the set of instructions, normally on a disk, that tells computers how to operate.

Official figures show that software and data export revenues totaled about US$7 million in 1988. The trade department thinks that was understated because of inadequate record-keeping by businesses, and that exports could have been as much as US$26 million.