MANILA, Philippines - A furniture exporter has appealed anew to the government to undertake measures to stem the peso from gaining further ground, noting a 44 to 45 to the dollar level can ensure their survival crucial for continuing jobs creation.
“With 44 to 45, we will survive. But if we go lower than this, we already reached 43, it is already painful,” said Rashmi Tolentino-Singh, chairperson and chief executive officer of Lightworks Resources Inc.
Singh said the peso’s rise against the US dollar makes Philippine exports uncompetitive.
“Unless something is done about the exchange rate, no matter how much we grow, we are not very competitive. Because whatever we make at the end of the day is eaten by the appreciation of the peso,” she reasoned out.
Singh noted that industry players, however, could not raise their prices right away, noting they need a lead time of at least six months to a year to adjust their costs.
“And when you adjust, a buyer will say you are uncompetitive so why should I buy from you. I will go to China, Indonesia or Vietnam,” she explained.
Singh called on the Bangko Sentral ng Pilipinas to squarely address this issue.
She believes that the peso-dollar movement is not driven by market forces, thus could be addressed at the macroeconomic level.
The peso has remained at 43 to a dollar territory, closing at P43.25 on Friday, compared to the March average of 43.52 and February’s 43.70. The foreign exchange averaged 44.17 to the dollar in January this year.
But despite various problems, Singh expressed optimism that the furniture sector could still generate growth in 2011.
“It most likely would be a better year than last year. This time, there are some regular Philippine buyers and the new ones seem to be serious,” she said.
Singh further said industry players would continue to provide jobs as long as they receive orders.