THE Philippines’ current account deficit widened by more than half in the first six months of the year as imports continued to grow faster than exports, the Bangko Sentral ng Pilipinas (BSP) reported late Friday.
The current account deficit reached $15.44 billion in January to June, up 51.7 percent from the $10.18-billion deficit recorded in the same period last year.
“The current account deficit widened mainly on account of a larger trade-in-goods deficit,” the central bank said, noting that the value of imports increased at a faster pace than exports.
The current account covers the Philippines’ transactions with the rest of the world involving goods and services, income earned from and paid to other countries, and transfers such as remittances and grants.
It was equivalent to 5.6 percent of gross national income (GNI) in January to June, compared with 3.7 percent a year earlier.
As a share of gross domestic product (GDP), the deficit stood at 6.4 percent, compared with 4.3 percent in the same period last year.
The central bank expects current account deficit to narrow at $18 billion this year from the previous $20.3 billion while that for next year is also a lower at $19.7 billion from $21.9 billion.
Total goods exports increased 4.9 percent to $84.57 billion in the first half from $80.63 billion a year earlier.
Imports, meanwhile, grew by a much faster 10.1 percent to $100.01 billion from $90.81 billion.
As a result, the country’s goods deficit widened to $37.70 billion from $32.63 billion in the same period last year, a 15.5-percent increase.
The BSP said merchandise exports recorded solid growth, largely driven by “higher shipments of electronic products, gold, and machinery and transport equipment amid sustained external demand.”
“However, imports continued to grow at a faster pace, primarily reflecting higher import bills, with growth concentrated in telecommunications equipment, electrical machinery, manufacturing inputs, and fuel products that supported domestic investment, production, and energy requirements,” the central bank said.
“Elevated global energy prices during the period, driven by supply concerns linked to geopolitical developments in the Middle East, contributed to higher import payments,” it added.
The widening goods deficit was partly cushioned by surpluses in services, primary income and secondary income.
The services account posted a $5.22-billion surplus in January to June, slightly higher than the $5.14-billion surplus a year earlier.
Services exports increased 4.8 percent to $25.32 billion from $24.15 billion, while services imports rose 5.7 percent to $20.10 billion from $19.01 billion.
The BSP said services exports benefited from continued growth in business process outsourcing-related revenues and travel receipts, supported by higher tourist arrivals.
The primary income account also remained in surplus, although the balance declined to $1.36 billion from $1.90 billion a year earlier.
Receipts under primary income fell 6.1 percent to $8.22 billion, while payments edged up 0.2 percent to $6.87 billion.
Meanwhile, the secondary income surplus increased slightly to $15.69 billion from $15.41 billion.
Receipts under the account rose 2.4 percent to $16.30 billion, while payments increased 21.1 percent to $611 million.
The broader goods, services, and primary income account posted a deficit of $31.13 billion in the first half, wider than the $25.59-billion gap a year earlier.
Exports of goods, services, and primary income rose 5.5 percent to $68.27 billion, while imports increased 10.1 percent to $99.40 billion.
The goods and services deficit likewise widened to $32.48 billion from $27.49 billion, with exports rising 7.3 percent to $60.05 billion and imports increasing 10.9 percent to $92.53 billion.
The deterioration in the current account, however, did not translate into an equally large deterioration in the country’s overall balance of payments (BOP) position.
The Philippines recorded an overall BOP deficit of $3.88 billion in January to June, narrower than the $5.59-billion deficit recorded in the same period last year.
The BOP deficit was equivalent to 1.6 percent of GDP, an improvement from 2.4 percent a year earlier.
“The lower BOP deficit in the first half of 2026 reflected stronger financial account inflows, which partly offset the wider current account deficit,” the central bank said.
The central bank expects BOP deficit to widen to $10.7 billion, up from the $7.8-billion outlook three months earlier. The forecast for next year was set at $11.0 billion, also higher than the previous forecast of $8.5 billion.
The country’s BOP position ended in a $5.7-billion deficit last year, a reversal from 2024’s $609-million surplus.
