GTH exporters, Philexim ink credit partnership deal

Battered by different crises and challenges, the small and medium exporters of gifts, toys and housewares can now hope for brighter future, as the state-owned Philippine Export-Import Credit Agency (PhilExim) vowed to help the struggling exporters.

The Gift, Toys and Housewares exporters association in Cebu (GTH) has signed a memorandum of agreement (MOA) with PhilExim to be the first organization in the Philippines to work on their credit programs.

This means that member companies of GTH-Cebu will be able to partake a portion of the P450 million worth of loan guarantee allocated for SMEs in the Philippines.

GTH-Cebu president Jennifer Cruz said this development has come in a time while the export sector is swamped with different challenges, including the strengthening of the peso against the US dollar, the Abaca harvest ban, and Custom's Broker Act, among other issues.

"If this partnership with GTH-Cebu and PhilExim will go on smoothly, all of us will benefit from this," Cruz told GTH-Cebu members during the organization's general membership meeting held at City Sports Club.

"One big issue today is the "strengthening of the peso" from the exchange rate of P56 to $1 last quarter of 2005, to P51.26 to $1 today. Most exporters incurred a big loss with the sudden appreciation of the peso. Similarly, we have made our position and representation for the government to do something and help the exporters," he stressed.

PhilExim president and chief executive officer (CEO) Virgilio R. Angelo said that this new credit and guarantee facility to be offered by GTH-Cebu members is expected to help smaller exporters to sustain its export business, amid challenges.

"I know that the export industry is currently facing mounting problems, including the high cost of doing business, global competitiveness, new regulation of the government that could add further bureaucracy problem, in this way, we hope to be of help to the exporters, especially the small and medium players," Angelo said during the same event.

PhilExim has made available the P450 million to help the government pump prime the development of SMEs in export market.

Angelo said the agency has set aside this fund to primarily cater to the needs of the exporters, who are looking for working capital of business improvement financing.

"This year we are trying to reach out more clients in the country. We are strongly supportive of the government's pursuit to enhance the business competitiveness and success of the SMEs, especially in the regions," Angelo said.

According to Cruz, there are a lot of exporters especially in GTH manufacturers who are currently in need for financial assistance, in order to expand, and sustain the marketability of their businesses in the global market.

Angelo vowed that processing of the credit and guarantee applications will now be shortened and PhilExim will make it easier for potential company applicant to avail of the much needed financial help.

At present, the agency has existing joint agreement with more than 10 universal and commercial banks in the country to enable banks' export clients to avail of the financing facilities available in PhilExim.