CEBU, Philippines - Although the export performance for the last seven months of 2009 showed a 33 percent decline, the Department of Trade and Industry (DTI) continues to hope for the sector’s recovery before the year ends.
“The export industry will have higher chances of success in foreign markets once the global economy recovers from the financial crisis by the end of 2009,” said DTI Undersecretary Thomas Aquino in an interview during his recent visit to Cebu.
Latest government figure showed that from January to July of this year showed a 33 percent plunged in export performance from total export volume of US$30.06 million in 2008 the figure went down by 31.69 percent in the same period this year to US$20.533 million.
All export commodities registered negative performance in the first seven months of this year, except for fine jewelry, fruits and vegetables, and tuna exports. Fine jewelry export went up by 9.41 percent, fruit and vegetable exports improved by only 1.51 percent, and tuna export up by 6.57 percent.
Other export commodities, such as furniture, home furnishing, garments, semi-conductors, marine products and carrageenan, machinery and transport, electronic products, among others registered negative performance.
In the last two months (August and September) figures still continued to post negative trend. Aquino pointed out that while most Philippine businesses are undergoing “stress tests” as a result of the crisis, some of these players would likely recover.
He noted that among the sectors to emerge from the crisis are those selling consumer products also to the domestic market, as well as those offering services for the overseas Filipinos.
Citing projection made by the Goldman Sachs Global Economics Group, the trade official said the Philippines is going to be the 17th biggest market in the world by 2050, indicating enormous opportunities available for businesses.
The country has also been included in the Next 11 countries, along with Brazil, Russia, India, China and ASEAN nations (BRICA), which are seen to pick up, outpacing G-7 countries, he stressed.
Aquino said Filipinos overseas, on the other hand, could serve as “ready buyers” for the Philippine products.
Likewise, Aquino said goods and services like organic and natural products that are able to keep in step with increasing product standards in markets abroad, could also ride out a crisis.
Other sectors that have recovery potentials include providers of services based on relatively lower-cost business models like information technology (IT) technical support and healthcare; and goods and services based on unique, natural selling propositions like specialized tourist facilities and events creation.
To prepare for the rebound, Aquino advised exporters to “deepen their expertise in doing business in specific foreign markets as a way of internationalizing their core operations.”
“On the other hand, the government needs to build capacity and increase size of resources set for export trade financing, including proper appreciation of opportunities and risks in reconfigured foreign markets,” he added.
Aquino said government trade staff will also undergo training to intensify familiarity with changing realities of competition and entry into foreign markets.
In a related development, Philexport President President Sergio Ortiz-Luis Jr. earlier said that some major exports particularly electronics and semiconductor are already beginning to recover lost grounds, with new orders trickling back.