The Philippines’ current account deficit more than doubled in the third quarter of 2024, reaching $5.7 billion, compared to $2.2 billion a year ago. This widening was primarily driven by a larger trade deficit and decreased net receipts from services.
The country’s trade deficit widened by 10.1% to $18.5 billion in the third quarter due to a decline in exports, particularly electronic products, and an increase in imports, mainly iron, steel, and metalliferous ores.
Net receipts from the trade in services fell by 36.3% to $3.3 billion while net primary income receipts decreased slightly to $1.2 billion.
The financial account recorded a net inflow of $10.5 billion in the third quarter. As a result, the country’s balance of payments (BoP) surplus for the first nine months of 2024 reached $5.1 billion, compared to $1.7 billion in the same period last year.
Overall, the widening current account deficit, although concerning, was offset by a strong financial account, leading to a positive BoP.
However, the country needs to address the trade deficit and maintain strong remittance inflows to sustain its economic growth.
