Trade deficit hits $4.05 billion in January, widest in 3 months

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February 28, 2026 | 12:00am

MANILA, Philippines — The country incurred a $4.05-billion trade deficit in January, the highest level in three months, according to the Philippine Statistics Authority.

Preliminary data from the PSA yesterday showed that the balance of trade in goods or the difference between exports and imports declined by 18 percent in January from the $4.93 billion shortfall in the same month last year. 

Despite narrowing year-on-year, the January trade deficit was the highest recorded since October 2025 when the shortfall was at $4.19 billion.

The January trade gap also widened compared to the $3.99 billion deficit last December.

 Philippine export sales rose by eight percent to $7.09 billion in January from $6.57 billion in the same month last year. This was the highest recorded since October 2025 when it reached $7.45 billion.

Electronic products continued to be the country’s top exports in January, with total earnings of $4.01 billion, 19 percent higher than the $3.37 billion value in the same month last year.

The United States was the top destination for Philippine exports in January, accounting for $1.16 billion or 16.4 percent of the total.

Moody’s Analytics economist Sarah Tan said that while January’s export growth was encouraging, the external environment has become more uncertain due to recent US tariff developments.

Hours after the US Supreme Court ruled on Feb. 20 that the sweeping reciprocal tariffs were unconstitutional, Trump signed an executive order imposing a 10-percent global tariff.

The following day, Trump said that he would hike the new tariff for all trade partners to 15 percent from 10 percent.

Tan said the US is expected to find other legal routes to bring tariffs back to the rates before the court ruling. 

“While this process may take time, the uncertainty over the eventual tariff structure and implementation timeline is likely to temper business sentiment and delay trade decisions. This uncertainty could cap export growth in the near term,” Tan said.

She said Philippine exports could post modest growth, supported by the electronics sector.

“Growth will likely be uneven and more subdued compared to last year as firms adopt a wait-and-see stance amid evolving US trade policy,” Tan said.

Philippine Exporters Confederation Inc. president Sergio Ortiz-Luis Jr. said the group is still trying to assess the potential impact of the new global tariff imposed by the US.

Given the uncertain trade environment, Ortiz-Luis emphasized the need for genuine support for the export sector in terms of access to financing, trade promotion, product development and overseas trade fair participation.

PSA data also showed that Philippine imports declined by three percent to $11.14 billion in January from $11.5 billion in the same month a year ago.

The January import value was the highest since October 2025 when it amounted to $11.64 billion.

Similar to exports, electronic products also had the highest import value in January 2026, amounting to $2.99 billion or 26.8 percent of the country’s total imports.

China maintained its position as the country’s largest supplier of imports, accounting for $3.26 billion or 29 percent of the total in January.

Total external trade in goods rose slightly to $18.24 billion in January from $18.07 billion in the same month last year.