Recently released data on imports indicated a steep decline in shipments of capital goods necessary for the expansion of local businesses and the stimulation of job creation. The drop was blamed largely on Manila City’s truck ban, which has resulted in the snail’s pace movement of goods out of the city’s overcrowded major ports.
In reaction to this data, which was released on Tuesday, Socioeconomic Planning Secretary Arsenio Balisacan said in a statement: “The decline in the country’s imports of capital goods is a concern that needs to be addressed.”
Total payments for imported goods in June 2014 amounted to only $4.7 billion, as against $4.9 billion in June 2013. These figures reflect a drop of 3.6 percent in the total amount.
This decline followed a 27.2-percent drop in capital goods imports, and marked fifth consecutive monthly downtrend since February.
The situation has caused alarm within the National Economic Development Authority (Neda), which is also under the leadership of Balisican.
“Efforts should be firmed up to encourage businesses to invest more on capital goods. These are crucial for increasing the global competitiveness of domestic firms in the Philippines,” Balisican said.
He added that Manila’s port congestion is likewise to blame for the decline in the ikport of caoital goods, and noted that these conditions must be “expeditiously resolved.”
“Logistical issues result in additional cost to both producers and consumers, especially for raw materials and capital goods intended for production as well as food and other non-durable items for consumption,” he said.
Trade Secretary Gregory Domingo had earlier stated that Manila’s severely congested ports could only process up to 3,500 containers a day, a figure which is dramatically down from d 6,000 containers a day prior to the enforcement of the truck ban.
Likewise, Economic Zone Authority head Lilia de Lima noted that trucking costs have since three times their initial costs.
The city truck ban, in effect during peak hours of the day, has made it difficult for shippers to move their containers to and from the port area.