P100 million support fund to help exporters recover

CEBU, Philippines - The government’s allocation of P100 million for the export industry is seen to help exporters cope with the recovering market.

PhilExport-Cebu executive director Fred Escalona said the budget allocation will definitely be a great help to the struggling export industry although Cebu will only get P30 million of the total allocated funds for the entire country, under the government’s Export Support Fund (ESF).

Escalona said the export sector in Cebu hopes to get the funding allocation very soon, as the Export Development Council (EDC) is giving the organization until Friday, May 21, to revise the former proposals under the ESF program.

Originally, the government announced to give P1 billion under the ESF, but due to monetary constraints in the government, it slashed the original allocation to P100 million for the export sector in the country.

“We did not really expect the P100 million funding after the government announced that it will realign the initial P1 billion ESF for calamity relief. The funding will really help many exporters here as they [continue to] struggle amid a global market recovery,” Escalona said.

He added that EDC has instructed the export organization around the country, including PhilExport-Cebu to reduce the proposals in availing of the funds due to the government’s budget limitation.

Alan Suarez, Export Development Council private sector representative and former Philexport-Cebu president said that of the total P100 million pledge for exporters, P50 million will be allocated for the Visayas, with P30 million going to Cebu and P20 million to Eastern Visayas.

The P30 million for Cebu will be divided among three sectors: Fashion accessory; gift, toys and houseware; and furniture, including Philexport Cebu.

Escalona said the fund may be used by exporters for international promotions, design enhancement seminars, and for expenses incurred in enhancing their value chain.

“The position paper we submitted to Malacañang was effective,” said Escalona. “Now, Cebu will get 30 percent of the total fund, which is a very big help.”

Philexport Cebu submitted last month a position paper asking the government to intervene in the recent appreciation of the peso and for it to abandon its plan to realign the balance of the P1-billion allocation for the ESF to the calamity fund.

Last month, PhilExport-Cebu expressed its disappointment on the government’s proposed recommendation to divert the un-drawn balance of P1-billion Export Support Fund to the El Niño calamity fund, through a position paper submitted to President Gloria Arroyo.

PhilExport-Cebu together with other exporters from all over Central Visayas urged particularly the Department of Trade and Industry (DTI) to abandon its plan to recommend to the Office of Budget and Management to divert the P1-billion ESF, roughly around P989 million, to the El Niño Calamity fund.

PhilExport-Cebu stressed that the export sector, especially those outside the economic zones, have not yet fully recovered from the effects of the global financial crisis.

Because of this move, Escalona said the government agreed to allocate at least P100 million for the Visayas, of which Cebu will get 30 percent share.