MANILA, Philippines - Amid the continued contraction of merchandise exports in October 2011, the National Economic and Development Authority (NEDA) urged Philippine exporters to pursue cross country and sector partnership agreements to boost production and demand for local products, and benefit from research and development and technology advancement. These could reduce the country’s vulnerability to adverse external developments as well as make exporters more adaptive to the fast pace of international trade.
Exports in October went down by 14.6 percent to $4.1 billion, from $4.8 billion posted in the same period last year.
“The country’s current trade structure heavily favors the exports of electronic products, thus, making the country’s export performance very vulnerable to the highs and lows in the demand for these products,” said Socioeconomic Planning Secretary Cayetano W. Paderanga Jr.
Exports of electronic products plunged by 36.5 percent as it continued to be affected by the sluggish global demand and by the disruption in the supply chain in Asia due to natural disasters. Export earnings from manufactured goods fell by 21.7 percent in October 2011 to $3.3 billion from $4.2 billion in the same period in 2010.
“Philippine exporters should also engage in research and development and employ technology advancement on their products. This can help the country adapt to the fast pace of a changing world trade,” the Cabinet official said.
The exports decline in October 2011 was an improvement compared to the 27-percent contraction in September 2011. Meanwhile, year-to-date exports amounted to $41.3 billion, 4.3 percent lower than in 2010.
“The Philippines must also be aggressive in exploring partnerships with foreign companies that would help in establishing the country as a production hub,” added Paderanga, who is also NEDA director-general.
He stressed that measures that can enhance productivity and add more value to production should be considered, like encouraging electronics companies to shift to high-technology items like smart phones.
“Philippine products should be marketed as high-quality products through several channels and strategies. These include participation in major international trade events, launching of high-impact and high-level in-bound fairs and missions in the country,” said Paderanga
Meanwhile, exports growth in wood manufactures (82.7 percent), mineral products (54.1 percent), total agro-based products (27.3 percent), petroleum products (203.6 percent), and chemicals (26 percent) prevented larger decline in total export earnings.
Japan remained as the country’s top export destination with 20.3-percent share, comprising mainly of electronic products, wood manufactures, and chemicals. The United States placed second with a 14.9- percent share, followed by People’s Republic of China (13.9 percent), Hong Kong SAR (6.7 percent) and Singapore (6.7 percent).
Other countries in the ASEAN region were able to avoid a slump in exports growth. Viet Nam remained the top performer in the region, growing by 33.5 percent due to heavy outward shipments of crude oil, agri-based products, and steel.