A report by Nomura, released on April 23, 2025, indicates that the Philippine manufacturing sector is at risk of facing increased competition due to a surge in Chinese imports. The report analyzed 45 countries and found that the rise in Chinese imports is impacting many economies, including the Philippines, even before the U.S.-China trade tensions escalated.
According to the Japanese investment bank, countries like the Philippines have seen significant increases in Chinese imports, which have coincided with a slowdown in manufacturing growth. The report suggests that the trend could intensify if the U.S.-China trade war continues, with China redirecting exports to markets outside of the United States.
Euben Paracuelles, Nomura’s chief ASEAN economist, noted that a prolonged trade war between the U.S. and China could result in higher competition for local industries in countries like the Philippines, which are more vulnerable to China’s growing import penetration. He highlighted that while lower-cost Chinese imports could help keep consumer inflation down, the broader economic impact could be substantial.
In the case of the Philippines, the report highlighted that manufacturing growth has slowed, with a modest increase of around 2% from 2018 to 2024, compared to a more robust growth rate of approximately 34% from 2011 to 2017. The study also showed that the share of Chinese imports in the Philippines’ manufacturing sectors rose by 7% from 2017 to 2024, while the output of these sectors shrank by more than 30%.
Chinese imports have been particularly impactful in sectors such as food products, textiles, wood products, chemicals, rubber and plastics, and machinery. On the other hand, certain sectors, including beverages and pharmaceuticals, have seen a decline in Chinese import penetration.
Nomura’s report also pointed out a significant rise in trade investigations against Chinese imports in 2024, primarily in the form of anti-dumping measures. However, the Philippines was not among the countries that initiated such trade remedies.
To mitigate the impact of increased competition, Paracuelles recommended that the Philippines pursue structural reforms to enhance competitiveness. These reforms could include diversifying the manufacturing base, addressing high power costs, and improving the business environment.
The report’s findings reflect growing concerns in emerging market economies about the rising influence of Chinese imports, particularly in Asia, and the need for strategic adjustments to remain competitive in the global market.
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