Export council looking to set annual targets for 2011-2016
Sta. Rosa, Laguna (9 December) -- The public-private Export Development Council (EDC) will propose annual growth targets of 13-14% starting next year with the aim of reaching nearly $100 billion in receipts by 2016.
The Philippines has to "level up and double up," said EDC deputy executive director Emmarita Z. Mijares, considering neighbors like Thailand and Indonesia have long topped $100 billion in merchandise exports alone.
If adopted, this would the first time for the EDC to set export targets beyond three-year intervals.
Ms. Mijares, who spoke at a forum for exporters, said the Philippine Export Development Plan (PEDP) for 2011-2013 is expected to be cleared by Malacaņang before the end of the year while advanced targets up to 2016, which will likely be used as the basis for the 2014-2016 plan, will also be submitted for approval.
The EDC set a 22% growth this year for total exports -- which include merchandise and service exports -- from 2009's $48.5 billion. By 2016, the figure should double to $98.8 billion, Ms. Mijares said. The annual pace is a little quicker from the 10% yearly growth under a PEDP 2011-2013 draft released early this year.
"These are conservative targets," Ms. Mijares said, adding that the targets depend on "inputs" from all export industries.
Electronics exports -- which have accounted for more than 40% of total exports in the past five years -- committed to only 10% growth annually, she noted, although the sector is expected to grow by 29% this year. Outsourcing, meanwhile, should grow by 12% annually and mining by around 30%.
Foreign direct investments (FDI) are crucial to attaining the growth targets, Ms. Mijares said, pointing to the Medium Term Philippine Development Plan that is still being drafted by the government.
"Our capacity to supply also has to grow," she said.
Ms. Mijares told the forum the Philippines would focus on products "up in the value chain," in particular mid- and high-priced premium products.
"Natural and organic" products will also be developed.
The PEDP market strategy will be to maximize the use of free trade deals which allow duty-free entry to export destinations and engage Europe and the United States, two of the country's top trading partners.
The Philippines will also try to sell to top emerging markets China and India, while Brazil and India will be "channel destinations."
The Philippines will also participate in the global supply chain by using China, India, and Southeast Asian neighbors as jump-off points to the US and the European Union. The country also needs to capture "export-oriented FDI" from China, Japan, Korea, Australia and New Zealand, Europe, and the US.
Ms. Mijares said the government would commit to an action plan that includes the establishment of a more independent export development body similar to those in Hong Kong and Singapore, through legislation; improved power supply and lower business costs; and reduced red tape.
The private sector, meanwhile, should develop industry road-maps, maximize export sales, and accelerate investments, she said.
"Sell, pay taxes, and collaborate," Ms. Mijares added.
The draft PEDP has identified 10 export revenue streams that account for 79% of the country's exports: electronics, auto parts and components, food, "home-style" products, minerals and fine jewelry, coconut products, garments, construction services, business process outsourcing and "wearables."
The stronger peso is not necessarily a setback for bigger exporters as the lower cost of imported raw materials can offset weaker revenues, Ms. Mijares said. But she admitted that small and medium enterprises who rely on local raw materials will be affected.
Semiconductor and Electronics Industries of the Philippines, Inc. (SEIPI) Chairman Dan C. Lachica said that several "enablers" were needed for the electronics industry to meet export targets.
"We need lower electricity rates and reliable electricity, continuation of incentives to manufacturers, the technology road-map which would develop other technologies like solar power, maximized utilization of airports and even lesser traffic," Mr. Lachica said.
Universities must also be equipped to "crank out graduate students who can do research and development for new technologies that we can master."
SEIPI expects to close the year with $28 billion in export revenues. For 2011, the industry group sees $31 billion in revenues and year-on-year growth of 10% to $50 billion in 2016, half of the country's total exports.
Martin E. Crisostomo, Business Processing Association of the Philippines (BPAP) executive director for external affairs, said in a separate phone interview that projected 2016 revenues for the group's service exports was $25 billion, about three times this year's expected $9 billion.
"To reach the projected revenues, we are focusing resources on talent development. With funding from the government, we are optimistic that we will achieve the target. That's the rosy picture," he added.
Mr. Crisostomo said the government on Dec. 1 gave the BPAP P62 million in budget support for promotions.
Ms. Mijares, meanwhile, said the PEDP will no longer be published as one neighboring country was found to have copied previous export plans.
"We will just talk directly to the exporters," she said. (PIA/Felipe F. Salvosa II, Emilia Narni J. David and Aura Marie P. Dagcutan) [top]