ESF program under review, implementation still unclear

CEBU, Philippines - The Aquino administration is currently reviewing if it has to continue the implementation of the Export Support Fund (ESF), as the export market is starting to recover.

Department of Trade and Industry (DTI-7) regional director Asteria Caberte said it is not clear yet if the government will continue the ESF program, although serious review of the special assistance for the exporters is currently being done.

“We understand that the export sector is not yet fully recovered. But, we already see recovery on the road,” Caberte said.

Because of this, Export Development Council (EDC) private sector representative and former Philexport-Cebu president Allan Suarez said that advocacy in this concern will be released soon to convince the P-Noy government to sustain the ESF.

ESF is a special assistance program implemented by the past administration to help the Philippine export industry cope with the effects of the global financial crisis.

According to Suarez, the program is facing threat of discontinuation as the present administration believes that the export sector in the country is performing well, based on the all-time-high growth achieved by the sector in the last few months.

However, Suarez said EDC, together with export-related organizations, especially in Cebu will fight on this assumption, by convincing President Benigno Aquino II, that majority of the exporters can hardly breathe because of the external challenges, including the volatile foreign exchange.

Suarez explained that what made the export sector in the Philippines grew in the last few months, compared to its performance a year ago, is because of the improving and recovering market of export products made inside the economic zones, including BPO (Business Process Outsourcing) jobs.

Other export sub-sectors on the other hand, are still suffering, especially in Cebu, where most exporters are using indigenous materials, and hit by the suffocating competition in the global market.

“They [new administration] need more understanding how export is doing in this part of the country [Cebu, and Southern Philippines]. There should be a proper dialogue to find out what are the current concerns of the exporters nationwide, not only looking at the performance of companies inside the economic zones,” Suarez said a separate interview.

Suarez said EDC will initiate the advocacy to convince the PNoy administration to continue the ESF.

At present, Suarez said the export sector is talking and informally discussing about this, and may soon formulate a formal request to be submitted to the Office of the President.

In late 2008, following the collapse of the US financial system that led to the global economic crisis, former President Gloria Arroyo approved a P1Billion Export Support Fund (ESF) as the entire export sector reeled from cancelled orders and bleak prospects ahead.

Suarez said the situation still continues up until today, although some exporters are observing slight improvement of orders already.

The fund was established to help exporters to promote their products and build capacity in order for them to be competitive in the global market that have shrunk considerably.