19 November 2004  - The Department of Foreign Affairs today announced that the momentum of trade between the Philippines and China has exceeded expectations in the first nine months of the year. At this time, the figure may have already surpassed the US$ 10-billion-trade volume target for 2005, because trends favor active trading in the last quarter.

Citing official statistics obtained recently by the Philippine Embassy in Beijing, Acting Secretary Franklin Ebdalin emphasized that the strong showing of bilateral trade figures manifests the dynamism of Philippines-China relations, its potentials and their direct bearing on the Philippine economic agenda.

“Broader trade and economic exchanges between the Philippines and China further strengthen the bilateral ties and serve as the basis for its more comprehensive development, especially as China (according to some projections) is expected to take its place as the world’s third biggest trading nation, after the United States and Germany, by the year’s end,”  Acting Secretary Ebdalin said.

Philippines-China trade volume from January to September 2004, according to statistics released by China’s General Administration of Customs, amounted to US$9.35 billion.  This represents a 45.3 per cent increase from the figure posted in the same period in 2003.

The Philippines enjoyed a trade surplus of US$ 3.12 billion, with a total US$ 6.23 billion worth of exports, mainly semiconductor devices, copper cathodes, mechanical parts and accessories, fuel oils, petroleum naptha, fresh bananas and crude coconut oil.  China is the biggest market for Philippine copper cathode exports and the second biggest market (next to Japan) for Philippine fresh bananas

The Philippines continues to be one of the top suppliers of fruits to China. Philippine fruits, mainly fresh bananas, earned US$66.3 million in export receipts, capturing 14.39 per cent share of China’s market during the same period.  There was also a substantive worth of exports of Philippine mangoes, papayas and pineapples sold to China in the first nine months.

Philippine exports falling under chapter 85 of the HS code (electrical machinery end equipment) accounted for 46.5 per cent of the total RP-China trade or nearly 70 per cent (69.8) of Philippine exports to China from January to September 2004.

China’s exports to the Philippines for the same period amounted to US$ 3.11 billion, representing a 45.9 per cent increase of receipts, mainly of machinery and equipment, machinery and mechanical appliances, mineral fuels and oils, vehicles and parts, iron and steel and plastics.

“This is well in line with the agenda of the state visit of President Gloria Macapagal Arroyo to China on 1 -3 September 2004, which pursued a far-reaching, future-oriented relationship between the Philippines and China, ” according to Acting Secretary Ebdalin.

“We are confident that we are well on the way to meet the US$ 20 – billion trade target for 2009 set by President Arroyo and President Hu Jintao during their meeting in Beijing,”  Acting Secretary Ebdalin emphasized.

RP-China trade has been growing at an average annual rate of 38 per cent since 1998.  Bilateral trade volume stood at USS$ 9.4 billion in 2003, making China the 6th biggest trading partner of the Philippines last year.  That year, China accounted for 5 per cent of RP’s global trade.

“Clearly, there is a need to broaden and deepen the level of trade with China.  We need to enhance our competitive areas and work on a more diversified, a more solid trade structure vis-à-vis China,” Acting Secretary Ebdalin said, adding that “colleagues at the Department of Trade and Industry and in the private sector are working very hard on this.”

While the growth of RP-China trade was more remarkable than the upward trends in China’s trade with other ASEAN countries from 2003 and the first three quarters of 2004, Acting Secretary Ebdalin said that the Philippines “must continue to put efforts in improving the volume and structure of trade.

Secretary Ebdalin said that trade is one of the highlight stories of Philippines-China relations, which will mark its 30th anniversary in 2005.  “It’s one of the milestones,” he said,” considering that bilateral trade amounted to a little more than US$ 70 million in 1975.” END