CEBU, Philippines - World-renowned furniture designer Kenneth Cobonpue joins other optimists in the industry with hopes that recovery is near.
Although there is a profound downtrend of furniture products’ demand in the United States, the growing demand from emerging markets such as European consumers and some mid-east markets have offset the US downtrend.
Cobonpue, one of the furniture export icons in Cebu, believes that the furniture industry in Cebu is far from being a “sunset” industry, saying some companies are even seeing recovery starting this year.
“The Europe market is good, it provides a balancing factor,” Cobonpue said adding that other markets have also emerged like Iran, Russia, and others.
The industry, which has been in a "survival of the fittest" mode in recent years, because of the depressed market, is now left with the stronger players, as some companies were not able to make it along the way.
Although, it will take time to see the full upturn of the US market, Cobonpue said companies should take advantage of the strong demand from other continents like Europe.
Earlier, Bank of the Philippine Islands (BPI) economist Emmanuel Neri told Cebuano exporters to capitalize on the emerging Asian market. If penetrated well, furniture, as well as fashion accessory makers will be able to thrive amid the economic difficulties that hit the G7 countries, including Europe.
Aside from developing other markets like Europe and Middle East, Neri said exporters should also consider the rapid growth of per capita income of Asians, specially Indians and Chinese.
Asia is now becoming a very important market for exporters, including export players from the Philippines.
The Furniture exports in Cebu could also leverage on marketing their products to the Asian market, Neri said.
In the first eight months of 2008, furniture exports from Cebu plunged by an estimated 20 percent, the lowest industry decline in the last four years.
In the last two years, the furniture export trade in Cebu experienced "horror" times, losing about 25,000 jobs from streamlining, and cost cutting measures of companies.
Another economist Emilio T. Antonio Jr., suggested that exporters especially furniture should improve on their competitiveness, as the world offers limitless market potential, US is just part of it.
“From Philippines perspective, demand is infinite as long as it can sell at the prevailing dollar price, at a required quality,” he said.
The key for export sector to get back to its feet again, regardless of the global recession is to seriously address the competitiveness issue, “the key is competitiveness in terms of production cost and quality. It’s less a matter of demand—more a question of supply capability,” Antonio said. —Ehda M. Dagooc