Exporters unite in government subsidy bid

Gifts, Toys and Housewares Association of Exporters in Cebu (Cebu-GTH) will join the advocacy of the Cebu Furniture Industry Foundation Inc. (CFIF) for government subsidy for overseas marketing promotions.

The two organizations will join hands in asking the PhilExport and the Export Development Council (EDC) to support the proposal for the government, said GTH-Cebu president Jenifer Cruz.

"We have to ask the EDC through PhilExport to help us in this request. We have to do our best in order to fight the competition," Cruz said in an interview.

One of the things that will be given focus by the CFIF this year is to push for a subsidy program for furniture exporters who attend global marketing blitz, or international exhibition events.

CFIF president Michael Basubas earlier said that strong and still strengthening value of peso to the dollar has already crashed some exporters in terms of financial capacity, and those bits of support announced by President Gloria Macapagal Arroyo last year to cushion harmful effects of the strong peso, were not enough.

According to Basubas, Cebu furniture exporters are now trying to hit the high-end markets, as the huge market in the United States (US) has declined significantly due to strong competition and consumers' budget constraints.

Demand for global furniture market has plunged by about 30 percent in the last few months, "budget for furniture is eaten up by high gasoline expenses," Basubas said.

Subsidy from the government is needed in these times of furniture export crisis, as it now more expensive to do promotional marketing.

Exporters now will go after the untapped, yet high end consumer market around the world, which requires them to travel from one continent to the other.

Likewise, Cruz said the small and medium GTH exporters are also battered by the same problems faced by the furniture makers. The burden is much heavier for the GTH exporters considering that most of them are small to medium players only.

The subsidy proposal from the government may be a long-shot deal, however, if given the chance by the Arroyo administration to speed the implementation of this bid, exporters will be able to fight and "stay above water."

Unlike the furniture sector that it registered a consistent negative growth of average five percent in the last couple of years, the GTH sector managed to post 10 percent growth in 2006 amid the peso strengthening to the US dollar.

According to Cruz, there are a lot of potential new markets that the GTH exporters could tap. However, it is more expensive to start penetrating these markets, such as Europe, because of higher cost.