Chemical firms expect modest export growth next year

MANILA, Philippines — Local chemical firms expect their exports to modestly grow by one percent next year amid the gradual recovery of the global economy.

“The economies are predicting that 2023 will still be slow because foreign countries are just starting a recession now,” said Oscar Barrera, Philippine Exporters Confederation Inc. (Philexport) trustee for the chemicals sector.

Barrera said consumers during an inflation surge allocate their money for basic needs like food, thus purchases for items like lipsticks, perfumes, makeup and nail polish will now be more secondary or delayed.

He also cited the rising electricity rates that are affecting the industry, particularly operations of their machines.

Barrera sees the industry’s growth returning to pre-pandemic levels in 2024, which used to be about three percent every year until 2019 or equivalent to $5 million in export earnings.

The Philexport trustee said industry players are keeping Europe and the Middle East as their biggest markets as they target to penetrate new ones.

“Europe is harder now to export because recently during the last two years, they were kind of protective also of their industries so they put non-tariff barriers that make it harder for foreign countries to sell to them,” Barrera said.

Moreover, Barrera shared that there are also new product formulations being developed, noting that chemicals are raw materials utilized by other industries.

“For example, the food industry also needs certain chemicals. We are hopeful the semiconductors are going to come back very quick and they need some basic chemicals there like hydrochloric acid as an example for cleaning the semiconductor chips and wafers,”Barrera said.

“So basically, chemicals are steady and coming back because of certain industries that are more stable in export,” he said.