PHILIPPINE exports, which declined year-on-year basis for 14 months up to May this year, are likely to see 3 percent growth for the entire 2016. That is the expectation of Sergio Ortiz-Luis Jr., the president of Philippine Exporters Confederation Inc. (Philexport).
If it is realized, the total exports for this year could hit $59.8 billion—still falling far short of the 6-9 percent growth, or $61.5-63.3 billion, the government had hoped to achieve.
In the 14 months to May this year, exports have yo-yoed from $4.4 billion in April 2015 to $5.3 billion in last July, then moved on an unsteady course to hit $4.7 billion in May this year, due mainly to weak demand of global markets amid slow global growth, trade uncertainties with eurozone on the “Brexit” issue, and the sluggish economic growth in China.
“The market is really the problem, not our products or policy,” said Ortiz-Luis. The 3 percent growth he has projected for this while year he said was “reasonable” based on the fact that exports of electronics and services exports are improving. To date, Ortiz-Luis said, there is recovery in the growth of electronics exports, which take up bulk or half of the country’s shipments, as well as good expansion in services exports.
Therefore, he said: “With us having negative growth [in merchandise]in almost half of the year, I think the more reasonable expectation would be 3 percent growth for total exports for the year.”
The government’s projection of export growth, which the state-run agency Development Budget Coordination Committee (DBCC) has revised from the 6 percent to 5 percent, he thinks is an “ambitious target,” while the 8-9 percent target of the Department of Trade and Industry (DTI) is unlikely to be met. “For us to be able to meet that [8 to 9 percent] target, we have to grow merchandise exports by 20 percent for the rest of the year, which is unlikely,” he said.
On Tuesday, data from Philippine Statistics Authority (PSA) cited merchandise exports dropping by 6.6 percent in the first five months of the year, including the 3.8 percent decline in the month of May alone.
According to the Philippine Export Development Plan (PEDP), the country is aiming total exports to hit more than $100 billion by 2017 compared with about $86.6 billion total exports in 2015. This can be realized, said the DTI Industry Promotions Group Director Sennen Perlada earlier, if the total exports grew by 8-9 percent in 2016 and 2017.
Out of the $86.6 billion total exports in 2015, merchandise exports accounted for $58.6 billion or more than two-thirds of the total while the rest were from service exports.