Trade chief explains RP's low utilization of FTA benefits
by Ritchelle Alburo
Cagayan de Oro City (18 November) -- Aside from lack of awareness of new trade opportunities that free trade agreements bring forth, Filipino entrepreneurs' low appetite for risk partly explains the country's low utilization of its free trade deals.
"Filipinos must dare to look beyond the domestic market and try to be less conservative in doing businesses in free trade areas. No risk, no return," said Trade Secretary Gregory Domingo during the start of a series of information campaign on promoting free trade agreements.
Organized by the Department of Trade and Industry, the info-seminar, entitled Doing Business in Free Trade Areas, will also be conducted in a number of provinces in the Visayas and Mindanao within the month.
Other than this, Domingo explained that the lack of confidence, poor packaging and uncompetitive pricing also contribute to limit the country's gains from having preferential access to the huge markets of its FTA partners, Japan, Australia, New Zealand, ASEAN, China and South Korea.
The Trade chief thus committed to closely work with the Department of Science and Technology-Packaging R&D Center of the Philippines to make the country's products more appealing to international consumers while encouraging local entrepreneurs to find innovative ways to lower cost without sacrificing quality to make their products globally competitive.
Meanwhile, Trade Undersecretary Adrian Cristobal noted that institutional and policy reforms will have to be undertaken to facilitate effective utilization of FTA benefits.
"The country's free trade deals should impel us to institute the crucial policy and institutional reforms and modernize governance to put our economy in step with the global environment," said Cristobal
On the same vein, PHILEXPORT President Sergio Ortiz-Luis Jr. stressed the need to continue reducing the cost of doing business and to make the policy environment more conducive to business.
Amidst these policy challenges, a few Filipino entrepreneurs encourage their fellow entrepreneurs to brave these unexplored global opportunities.
"It is very difficult to penetrate the ASEAN markets because we have similar products and theirs are cheaper. So one really needs to find a niche market," said Imelda J. Madarang, Vice President and General Manager of Corporate Export Division, RFM Corporation.
Madarang narrated that when they visited Laos, Myanmar and Cambodia (LAMARCA) they were discouraged to see those products from Thailand and Vietnam flooding the markets and sold at highly competitive price. However, they also discovered that consumers in these countries have affinity with Philippine-made products owing to the assistance extended by the country to the same in the past.
Penetrating the Asian region, particularly China, is very challenging, affirmed Antonio Tiu, President of Agri Nurture.
"But the returns are very high and this provides an incentive to understand the market, establish a network of contacts and enter into partnerships with other companies there," he said. (PHILEXPORT) [top]