MANILA, PHILIPPINES - Philippine imports plunged a record 37.4 percent in April from a year earlier to US$3.041 billion ($4.3 billion) as demand in the key electronics sector continued to be battered, the government said Thursday.

The figure represents the biggest year-on-year decline in imports ever recorded in percentage terms, the National Statistics Office said.

It was partly due to the fall in the prices of commodities like petroleum products and coal and a sharp drop in imports of iron, steel and transport equipment, the statistics office revealed.

Total imports in the first four months of the year were down 35 percent from the same period in 2008 to US$12.6 billion, the office said.

The April figure is also down from the US$3.27 billion recorded the previous month.

The decline "is a sign of a shrinking economy. Imports are a leading indicator of demand for our exports and domestic consumer spending," Jose Vistan of AB Capital Securities Inc. told AFP.

"It is clear indicator of the economy slowing down. If we continue to see numbers like that in imports and exports down the line, maybe next year, we could see a recession," Vistan warned.

However CIMB-GK economist Song Seng Wun said the downturn in trade was nearing an end.

"This probably represents the bottom. We've seen improving (trade) figures around the region," Song told Dow Jones Newswires.

Earlier this month, the government announced that exports in April hit US$2.802 billion, a 35.2 percent year-on-year reduction.

This brought the trade deficit for the month to US$238 million, down 55 percent from a year earlier, the government office said. The trade deficit for the first four months of 2009 fell 26.3 percent from a year earlier to US$1.912 billion.

Imports of electronic components - key ingredients in the manufacture of the country's electronics exports - were down 42 percent to US$924.42 millio. Components made up 30.4 percent of April imports.

Lower inbound shipments of electronic components is often a sign that exports of electronic products, which make up more than half the Philippines' output sold abroad, will also be down in the coming months.

Imports of mineral fuels and lubricants were the second largest export in April, accounting for US$551.67 million, a 46.8-percent reduction, the office said.

Japan was the largest source of imports in April, shipping US$393.02 million, or 12.9 percent of the total. The United States, China and Vietnam were second, third and fourth largest importers, respectively.