|
By Sergio R. Ortiz-Luis, President,
Philippine Exporters Confederation Inc. (PHILEXPORT)
Editor’s Note: The original title of this
piece written by Mr. Ortiz-Luis for The Times is “Responding to
the challenge of enhancing export competitiveness and
sustainability.” He is also the current president of the
Philippine Chamber of Commerce and Industry.
LIKE Filipino athletes bound to the Beijing
Olympics later this year, Philippine exporters face today the
grueling challenge of competing to win. Or they find themselves out
of the game.
With globalization already in our own backyard,
farmers and fisherfolk, domestic-oriented manufacturers, skilled
workers and professionals, and for that matter, the whole Philippine
economy find themselves in the same battleground.
If the modest growth in exports last year and
the first two months of this year is a gauge, we performed well
enough but below those of our neighbors. Our consolation is we have
not been knocked out of contention. The same is true in the race to
lure in foreign direct investments.
It is in the deployment of skilled workers and
professionals where we are still ahead.
On the whole, international ratings agencies
have ranked the Philippines at the bottom third of the most
competitive nations on earth, and very close to the bottom in East
Asia. Philippine ranking has continuously gone down in the past 10
years.
Last year was not a particularly good year for
exports, particularly so for indigenous products. A rapidly
appreciating peso pared down the peso equivalent of dollar earnings
by 18 percent, eroding profit margins. As a result, hundreds of
small and medium enterprises laid off tens of thousands of workers
by retrenchment, suspension of export operations or closures.
Industries that depend on local raw materials
like food, handicrafts, fashion and fine jewelry got the worst
beating not only by spending more pesos in producing goods, but also
in finding their products more expensive abroad.
Competitiveness, however, is not just selling
the cheapest product. It has much to do with product quality and
safety, design and packaging, speed of delivery, economy of scale
and reliability of the exporter in meeting orders.
At the national level, the cost of doing
business in the country, the level of productivity in an enterprise
and in entire industries, the efficiency in the processing of
business papers and the speed in the shipment of goods all
contribute to the competitiveness of a whole range of products,
whether exported or sold domestically.
By global and even Asian standards, we have been
falling behind in most areas where the competitiveness of each
country has been measured. The private sector and its partners in
government have realized that to reverse the trend, public-private
partnership has to be forged in a national effort to make the
Philippines more competitive.
Today, we have built two institutions in
response to those challenges: The Export Development Council (EDC)
in place since the Export Development Act of 1994 as the
private-public sector institution on top of export development
planning and implementation, and more recently, the National
Competitiveness Council (NCC) on top of putting together a national
competitiveness agenda and a work program to lift the Philippines
from the bottom of the list of competitive nations to the top third.
The EDC is at the final phase of consolidating
the 2008-2010 Philippine Export Development Plan drawn after over a
year of consultations and workshops among exporters and support
agencies. New features of the plan include bridging the gaps or weak
links in the value chain of each of the major export industries,
aggressive competitor intelligence and special sections on tackling
the volatile exchange rate as well as the high cost of electricity.
The NCC, on the other hand, has been working in
specific areas of enhancing Philippine competitiveness from
upgrading the quality of the country’s human resource base,
putting in place strategic infrastructure projects, eliminating red
tape in the processing of business-related papers, reducing the cost
of doing business, particularly electricity rates, and enacting into
law crucial economic reforms.
In sum, the business community has been working
hand in hand with the economic arms of government in building
institutions that continue to work at making Philippine products,
Filipino services, and entire industries at par with the best in the
world.
There are no spectacular results yet, for
building a competitive economy is a long and difficult task. But
despite the many national and global challenges, we get inspiration
to move on from our vision and mission of developing an export-led
national growth and development that will help facilitate the
improvement of the quality of lives of most, if not all Filipinos.
|
