Furniture exporters eye intra-Asia trade

CEBU, Philippines - After learning their lessons the hard way at the height of the global financial crisis that mainly hit its largest export market, the United States, Cebu furniture exporters are now more focused on developing market niches in Asian countries.

“We are looking at more at intra-Asia trade, as Asia has been least affected by the crisis. China and India are now starting to be interesting markets for us,” Cebu Furniture Industries Foundation (CFIF) President Angela Paulin said in her presentation during the Philippine Trade Policy Forum last April 6.

According to Paulin, although the United States economy is starting to show improvements, she said exporters are now making their own market backup and Asia is seen to have great potential.

She said furniture exporters can not be “overly optimistic,” adding that the real growth rate of the US, which has been reported at 1.8 percent in the last quarter, is not really enough to create jobs there.

“We practice cautious optimism with 15 million Americans still unemployed and increasing foreclosures,” she reiterated.

Paulin said that the local furniture industry must double its efforts to attract new markets and strengthen their competitive advantage, which are design and material innovation, quality, reliability in delivery, and professional business practices.

The industry is now intensively working with the government to effectively engage an intra-Asia trade because these markets are least affected by the crisis.

CFIF would need the government’s support in terms of trade promotion, innovation, and market intelligence, she stressed.

On the other hand, in order to provide stronger caution to keep the industry thriving amid the “still” fragile market, the industry is also looking at a new positioning strategy in the area of “green products.”

Recently, the European Commission earlier announced it has released 1-million Euros or approximately P65-million worth of grant for Cebu-based small and medium enterprise (SME) players, including exporters, to help facilitate the “greening” of Cebu industries.

Through the three-year SMART-Cebu (SMEs for Environment Accountability, Responsibility, and Transparency) program, at least 450 SME exporters in Cebu will mentored and helped in pursuing legitimate green or environmentally-friendly operations.

If the industry positions itself in the area of green products, Paulin said this will propel Cebu as the destination of sustainable furnishings, furniture and fashion accessory.

Meanwhile, Paulin lauded the report from the Bureau of Customs in Cebu (BoC- Cebu) which showed that the demand for Cebu’s furniture exports registered a 10 percent growth in the first two months of the year, which industry players consider a good indication that the global economy is now in the uptrend.

The BoC report revealed that in January this year, demand rose to 10.3 percent with local furniture exporters shipping 634 containers out of the Port of Cebu, compared to only 575 containers shipped in the same period last year.

In February, the BoC reported a 9.7 percent jump in containers shipped from 617 in 2009 to 677 in the same month this year.