While hoping for a rebound in the United States economy, exporters are calling on the Philippine government to provide “band-aid” solutions to prevent further retrenchments in the industry.
The exporters are keeping their fingers crossed that a complete turn around will be theirs once the US economy gets back on its feet again, but for now the industry needs the government’s help to survive while the US economy is still recuperating.
"We hope that there will be no more retrenchment measures to happen this year, as the US economy is projected to be back on its feet again," said Cebu Furniture Industries Foundation Inc. (CFIF) former president Michael Basubas.
Basubas said the sector’s lifeline is highly dependent on the measures drafted by the Obama administration in rescuing the US economy from the economic downfall.
"The projection so far in the US economy is bright, we are banking on this. Hopefully, retrenchment of workers will be avoided this year," Basubas said.
For the past two years, the furniture industry in Cebu slashed over 25,000 jobs to keep the companies afloat. Some smaller furniture manufacturing companies failed to cope with the crisis and eventually folded up.
Basubas said that if the government is willing to save more jobs from the export sector, like the furniture industry, which is providing approximately 500 thousand jobs (directly and indirectly), immediate solutions must be implemented.
"If the government can de-value the peso to P55 per one US dollar, it could be a big help not only for the export sector, but also to the entire economy in the Philippines," Basubas said.
For him, he said manipulating the value of the peso is an ultimate solution in these times of difficulties, as the Overseas Foreign Workers (OFWs) are also suffering from losing jobs, and declining income abroad.
"Imagine if we peg the peso to P55 per one dollar, the P1 billion remittances a month alone could increase to P80 billion and this will go directly to the Philippine economy," Basubas said.
Also, if the peso will hit P55 per one dollar, the export sector can also leverage on this, as their products will become more competitive in the world market.
Even if the peso has strengthened to an average of P46 to P47 per dollar, Basubas said Philippine-made products still have a hard time to compete.
Although, the government had been insisting that the value of the peso cannot be intervened as its movement is largely market-dictated, Basubas believes that the government still has the power to manipulate its value, like what the other countries are doing, such as China.
"The market is very weak," Basubas said adding that if the government is sincere in helping industries to keep jobs, the export sector should be considered seriously.
Of the total 183 members of CFIF, about 40 companies have declared closures in the last two years, most of which were small and medium firms.