PCCI, in its plan to intervene in the new petitions, would like to scrutinize where the billions of pesos that the state company seeks to raise out of electricity consumers in the main grids of Luzon, Visayas and Mindanao will be plowed into.
It was pointed out that with the proliferation of energy companies that are offering green technologies like solar, wind, hydro and geothermal technologies, and the electrification of those unserved islands must be offered for private investors so that they will not be a burden to consumers elsewhere in the country.
The NPC, after the recent sale of the 600 megawatt Calaca power plants in Batangas, is no longer a substantial player in power generation in the country with a few aging plants left in its hands. And yet, it is asking for billions of pesos in new subsidies for it to run small power plants in missionary areas. -- Abe P. Belena, PHILEXPORT News and Features <--back
2. Exporters adopt drastic measures to survive
As orders from the United States and Europe got scarce, Randy Viray, a furniture exporter based in Pampanga turned to the local market, adjusted down his prices and found refuge in the midst of the global trade slump.
Rufino Manrique Jr., president of Moonbake whose chief export is canned laing or taro leaves, cut down his prices by up to 15 percent to keep overseas Filipinos in California, Hawaii and the Middle East buying his products. He has also started distributing his main product to the big malls and groceries across the country.
His revenue stream remained flat, no growth, but he hopes this will pick up when the crisis abates.
Earl Parreño, vice President of the Alter Trade Foundation, Inc. said his foundation that buys organic bananas from poor farmers in Northern Luzon and the Visayas, said they used to sell 97 percent of their muscovado sugar abroad. They are now targeting to sell at least 30 percent to local buyers.
These are only some of the tactics shared by surviving exporters to their peers in a two-day conference on how to stay afloat when the export market is drying up.
It turned out that when the crisis hit local exporters, some buyers abroad sought for as high as 50 percent discounts to continue ordering. On the whole, most of them sold on 60- to 90-day credit at discounts ranging from 5 to 20 percent.
Others went through their warehouses and started selling locally items that were not sold in the past but were just kept there. Some disposed of machinery and other assets that are now unused.
All of them found time in reviewing their financial health and went into severe cost-cutting measures. In extreme instances, they suspended their sub-contractors, retrenched their workers and limited production to members of the family.
It was also revealed that the garments industry, the second largest segment of the export, suffered severe decline of over 30 percent of their sales in the first half of the year that many have suspended their operations.
Johan Laman Trip, a marketing consultant from Europe who shared his insights with the exporters, advised that now is the time for the exporters to start making their post-crisis enterprise and industry plans. -- Abe P. Belena, PHILEXPORT News and Features <--back
3. Various RP exports will likely to recover from global crisis, says trade official
Various Philippine export sectors, including those offering goods and services with also strong domestic demand, would have higher chances of success in foreign markets once the global economy recovers from the financial crisis by the end of 2009.
The post-recovery assessment was given by Department of Trade and Industry Undersecretary Thomas G. Aquino during the recent PHILEXPORT general membership meeting. He projected the road to recovery will be seen towards year-end.
“A recovery always follows a recession,” he said. “The world will be as dynamic, if not more than it was before the crisis. However, global economy will be dispersed among more countries.”
Aquino pointed out that while most Philippine businesses are undergoing stress tests as a result of the crisis, some of these would likely recover.
He said export sectors to emerge include those selling basic consumer products which are also hits in the local market and those offering services for overseas Filipinos.
Citing projection made by the Goldman Sachs Global Economics Group, the trade official said the Philippines is going to be the 17th biggest market in the world by 2050, indicating enormous opportunities available for businesses.
The country has also been included in the Next 11 countries, along with Brazil, Russia, India, China and ASEAN nations (BRICA), which are seen to pick up, outpacing G-7 countries, he added.
Aquino said Filipinos overseas, on the other hand, could serve as “ready buyers” for the Philippine products.
Likewise, Aquino said goods and services like organic and natural products that are able to keep in step with increasing product standards in markets abroad, could also ride out a crisis.
Other sectors that have recovery potentials include providers of services based on relatively lower-cost business models like information technology (IT) technical support and healthcare; and goods and services based on unique, natural selling propositions of the country like specialized tourist facilities and events creation.
To prepare for the rebound, Aquino advised exporters to deepen their expertise in doing business in specific foreign markets as a way of internationalizing their core operations.
The government, for its part, shall raise the status of institutions, build capacity and increase size of resources set for export trade financing, including proper appreciation of opportunities and risks in reconfigured foreign markets, he said.
Aquino said government trade staff will also undergo training to intensify familiarity with changing realities of competition and entry into foreign markets.
“The world returns to dynamic growth but there is going to be a reconfiguration among players,” Aquino said. “First, the US and Europe struggle to recover conditioned by structural differences. Second, challenge to China in wielding/asserting global influence as a huge country-market.”
Aquino said there are already encouraging early signs of recovery in the market, citing the lower Philippine exports year-on-year declines in March and April this year compared to three months-ago figures.
His view was validated by PHILEXPORT President Sergio Ortiz-Luis Jr. who bared that some major exports particularly electronics and semiconductor are already beginning to recover lost grounds, with new orders trickling back. “This, coupled with the perking up of consumer spending in the United States, could mean that the worst is over,” he noted.
The Export Development Council has revised its projection for this year to a minus eight percent in total exports, with merchandise exports projected to reach negative 16 percent. -- Danielle Venz, PHILEXPORT News and Features <--back
4. Domestic roadshow to encourage SME investments in tourism ventures to be launched
A business group will embark on a nationwide roadshow to drum up interests of small and medium enterprises (SME) investors in tourism projects.
Samie Lim, tourism committee chairman of the Philippine Chamber of Commerce and Industry (PCCI), said they have identified priority tourism areas for investment promotion which are Cebu, Aklan particularly Boracay, Davao , Camarines Sur, Zambales, Bohol and Palawan .
“We have identified priority areas based on the results of the first-quarter tourists’ arrival. These provinces have taken off and are moving forward as tourist destinations,” he said during the recent launching of its InvesTour program focused on SMEs in partnership with PLDT SME Nation.
Apart from these, Lim said nine more secondary areas will comprise the second phase of the program --Ilocos Norte, Ilocos Sur, Mt. Province (Baguio), Pangasinan, Manila, Cavite, Batangas, Albay and Misamis Oriental (Cagayan de Oro).
He said they are still identifying the 10th province that shall be included in the group.
Following the success of their BizTour tourism campaign in encouraging visionary business leaders to put their money into the sector, Lim said they are now gearing their efforts to promote SME investments in tourism.
“We found that small business people are intimated about investing in tourism. But I guess the Taipans have gone ahead and they made money, and it’s time for all us to get into tourism,” he stressed.
“Tourist destinations need local restaurants, salons, travel agency, local transportation, tourist guides, various R and R (rest and recreation) activities and everything that a person needs so that he will have a great vacation,” he added. Lim said the local government units (LGUs) are optimistic about their investment tourism program especially designed for the SMEs.
“Last year, we tested this concept with the LGUs, with municipal mayors, with the city mayors and with the governors and we are very happy (because) they are very positive about this,” he said.
The National Competitiveness Council has identified tourism as among the eight sunrise industries which, if fully developed, can harness the country’s competitive advantages and propel economic growth.
The other sunrise industries are agri-business, business process outsourcing, mining, electronics, supply chain logistics, automotive manufacture; and health, wellness and retirement. -- Danielle Venz, PHILEXPORT News and Features <--back
5. Gov’t fast-tracking development of RP’s Halal industry
The Department of Trade and Industry (DTI) has increased the number of Halal coordinators and upgraded their capabilities to help fast track the development of the country’s huge Halal industry.
Senen Perlada, director of the Department of Trade and Industry’s Bureau of Export Trade Promotion, in a business forum said they have provided trainings to DTI regional and head office personnel who serve as coordinators to equip them with necessary knowledge and skills to handle coordination Halal activities.
Apart from the program, Perlada said trainings on food safety assurance system are also given to officers and members of the National Halal Accreditation Board of the Philippines (NHABPI) and key officers of Halal certifying bodies.
The Halal body is tasked to accredit Halal certifiers who determine if products were manufactured in compliance with the Philippine National Standard (PNS).
Perlada explained that the PNS 2067:2008 provides the general guidelines for the Philippine food industry on the preparation and handling of Halal food, including food supplements.
After the promulgation of the PNS 2067: 2008, the department launched the Halal advocacy program to heighten awareness about Halal.
For his part, Roberto Amores, the Food Trustee of the Philippine Exporters Confederation, Inc., said boosting Halal exports can be facilitated by government by directing a certifying Halal body to make the certification process convenient.
“This is a very important direction that we have to work on in order for us to be able to take this opportunity to explore the vast (Halal) market which is close to $700 billion all over the world. Great potential, I must admit, for Philippine food exports,” he noted in an earlier interview.
With the Halal accreditation system being fast tracked, Amores expressed hope that the country’s agriculture food export revenues could increase by 30 percent in the next few years.
“Processed food exports possess indigenous materials. The agriculture food industry in particular is not really considered as heavily affected by the global recession because the demand for food will remain,” he said.
The promotion of Halal products overseas was among the strategies to generate sales under the Philippine Export Development Plan 2008 to 2010. Aside from the Middle East and other Muslim countries, other important markets for Halal products include India, China and South Africa. -- Danielle Venz, PHILEXPORT News and Features <--back
6. PHILEXPORT pushes creation of market information system linked with gov’t marketing networks abroad
Exporters are pushing for the immediate creation of market and competitor information gathering and dissemination system that can be linked with government’s marketing networks abroad to enable firms to better prepare and comply with the rigid trade requirements imposed by importing countries.
Philippine Exporters Confederation, Inc. (PHILEXPORT) President Sergio Ortiz-Luis, Jr. during the group’s general membership meeting noted that more highly-developed countries resort to non-tariff barriers to trade, like the mandatory pre-testing of food imports of the United States and the European Union.
Likewise starting next year, traceability will be required of EU fish imports and furniture exports to the US, he said.
“The urgency of building a system of information gathering and dissemination has been made more urgent with recent developments,” he said.
“Developments like these need to be shared with affected (PHILEXPORT) members to give them the lead time to adjust and comply.”
Ortiz-Luis pointed out that the Department of Trade Industry’s commercial attaches fielded in the country’s competitor nations and major markets can provide vital market and competitor information to local exporters.
“This is especially important in countries where we have new trade arrangements like India, New Zealand and Australia,” he said.
Ortiz-Luis noted that such market and competitor information can better serve exporters if the dissemination system is linked up with that of PHILEXPORT which has direct access to the exporters.
“Our respective information gathering and dissemination arms must now link up more closely and work as a team,” he said. “We can do a lot more in the service of our constituents if the two set up regular, two-way communications.”
An expert in competitiveness has urged exporters to utilize business intelligence as a guide for product development and technological innovation. These are among the effective tools in increasing market share and penetrating new markets, he stressed. -- Danielle Venz, PHILEXPORT News and Features <--back
