News Analysis Trade

Plan to get ship-shape and competitive

Philippine exporters are not only challenged by competition from traders in other Asean countries, they are also challenged by the tired approach to shipping goods in their own. All that may change though, with the floating of the Philippine Export Development Plan (PEDP) – a four-pronged strategy, devised by the Philippine Export Marketing Bureau (EMB) – to put some wind in the sails of the country’s flagging export sector.

What the industry is currently faced with is an amalgam of slow and sliding global demand for local products, lack of competitiveness, insufficient export niches where the Philippines can claim either a comparative or competitive advantage, and revenue concentration in a reduced goods/markets universe. The plan’s architects believe that addressing these problems by dismantling the barriers to trading will provide the impetus for the country’s exporters to compete more effectively within the region.

The EMB’s four-point plan is: I. Diversify into new markets and new product lines. II. Identify and develop export capabilities in product categories where global demand is rising. III. Remove impediments that compromise export competitiveness. IV. Support the potential for goods and services where the Philippines can gain an export advantage.

Refreshingly, the PEDP does not dwell on the slump in world demand as the sole reason for the country’s export woes – with monthly contractions over the past year – which Philippine bureaucrats have tended to do of late when explaining the country’s poor export performance. What it has produced is a blueprint that looks at the ills within its own industry which, unlike global demand, it can do something about.

In addition to the four-point plan, the EMB, which comes under the Department of Trade and Industry, has also produced a block of eight industry-development strategies that are now in effect and will run through 2018. They are:

1. Design comprehensive packages of support for key and emerging sectors. Six sectors have been selected for their comparative advantage in terms of shipment volumes – electronics, processed food and beverage, coconut oil, motor vehicle parts, computer and information services. Four emerging exports have also been identified – activated carbon, chemicals, metal components, and fresh and preserved fish. Support for these will come by way of investments and market promotion, business matching, financing options, innovation support, and product development. 2. Remove the stranglehold of domestic regulations that impede the movement of goods. 3. Increase local-enterprise productivity and competitiveness. 4. Upgrade export-product quality. 5. Increase exporters’ access to finance. 6. Exploit opportunities offered by the Asean Economic Community and free trade agreements. 7. Attract foreign direct investment by linking intensified export promotion with initiatives to attract investments. 8. Enhance the innovative capacity of the export sector.

According to EMB director, Senen Perlada, weak global demand is currently dragging the performance of two-thirds of all Philippine goods exports.

The PEDP’s revised targets for total exports, 2016-2017 are: 2016 – between US$91.7 billion and US$93.6 billion; YoY growth, 6.6-8.8%. Goods exports, between US$63.3 billion and US$61.8 billion; YoY growth, 5.4%. Services exports, between US$29.882 billion and US$30.2 billion; YoY growth, 9-10.3%. 2017 – between US$98.8 billion and US$101.5 billion; YoY growth, 7.7-10.6% up on 2016. Goods exports, between US$65.957 billion and US$68 billion; 6.7-10% up on 2016. Services exports, between US$32.8 billion and US$33.5 billion; 9.9 -12% up on 2016.

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  • Yes, you are right BUT there is two sides to the business coin! What volume of goods, materials, technology and products does the Philippines have to export? The biggest export items seem to be OFW’s, mineral concentrate and agricultural products, in that order! What goes hand-in-hand with booming export is a national booming industry. Greater effort must be placed to enhance and nurture the local industries. 1. Erase all the current bureaucratic red tape bullshit and corruption. It turns off foreign investors and deflates local business. 2. Provide incentives for all start-ups. 3. Provide all economic zones with the necessary basic infrastructures for businesses to thrive and succeed. 4. Instruct all Philippine embassies to hard sell business opportunities in the Philippines.
    This is only the tip of the iceberg for the success of the nation!!!!

  • The make our products competitive in the world market is lower its production cost by reducing fuel and energy cost. Our fuel i.e. gasoline, diesel etc. is almost double compared to Malaysia and Indonesia while our electric cost is the highest. EMB plan will not work unless these issues are addressed.

  • … i am glad DTI will now step up to help our local exporters including the new ones in the industry… there’s no doubt Filipinos are creative and industrious people… for years all they want is the government’s full assistance for their products to be shown to the world… now that the possibility is getting near i am happy for all our exporters… yes, there’s so much our country can offer like