Garment exports back on growth track

The garments industry has finally joined other Philippine export products in the growth track in the month of July after lingering in the negative growth list for one-and-a-half years. The industry ranks second biggest export product, after electronics.

This can be gleaned from the latest export data released by the National Statistics Office (NSO) last week. With sales receipts totaling $262.4 million in July 2002, garment exports topped by 2.4 percent exports worth $256.30 made for the same month last year.

With the recovery of the garments industry, seven out of the country’s top 10 exports have bounced back from negative growth since early 2001. Electronics and semiconductor products still paced the rest of Philippine exports on the road to recovery. It posted an impressed growth rate of 23 percent on sales of $3.19 billion last July against $2.594 billion in the same month the year before.

Others in the top 10 that have continued to grow were woodcraft and furniture, petroleum, metal components, cathodes, ignition wiring sets and other manufactures from imported materials.

The laggards that are yet to overcome the global trade slump are fresh bananas and coconut oil.

Despite the impressive rebound of the electronics industry in the second quarter of the year, industry leaders stuck to their revised projection of hitting only half of the 10 percent growth target for the biggest segment of the export industry this year.

Because electronics make up more than half of the country’s export earnings, the one-digit projected growth rate is expected to hold back over-all export growth which got sustained at two-digit ranges for nine straight years from 1992 to the year 2000.

Exports contracted by 15 percent last year.

Ernie Santiago, executive director of the Semiconductor and Electronics Industries of the Philippines Inc. (SEIPI), two factors are bound to slow down the industry’s recovery in the coming months.

First, economies of United States and Japan – markets of high-tech products – have remained shaky. The two countries are the biggest markets for Philippine-made electronics exports.

Another reason behind the downscaling of this year’s growth target is the volatility of the market. Orders can easily be transferred from one country to another. Accurate projections can only be made on a quarterly interval based on purchase orders already made, he explained. — Philexport News & Features