Exporters are now starting to lose hope that the P1.8-billion support fund that was promised to them in January would be given during President Aquino’s term.
The support fund is a vital component of the Philippine Export Development Plan (PEDP) 2014-2016, which remains in limbo four months after its submission to the Palace.
“I’m beginning to see that it’s not going to come out on a timely basis, because the plan is going to end in 2014-2016, we’re now halfway, so we don’t even know which budget it will be put in. The earliest budget it can be placed in is 2016, and some might reason that it’s not necessary anymore because the PEDP only covers 2014-2016,” said Philippine Exporters Confederation Inc. President Sergio R. Ortiz-Luis Jr. in an interview. A source earlier said the Palace has endorsed the P1.8 billion earmarked for general export-development fund to the Department of Budget and Management (DBM) in January.
However, the plan has not progressed. Ortiz-Luis said they have not heard from the DBM on the status of the fund.
Exporters have been calling for an increase in funding for export development in a bid to make local exports competitive.
Currently, Ortiz-Luis said the unit of the Department of Trade and Industry (DTI) that is responsible for export promotion only has around P100 million annually, as mandated by the previous PEDP covering 2011 to 2013.
A prime example of DTI’s lack of funding support for exports is the absence of Philippine representation in the renowned Milan Furniture show last October, depriving local furniture makers of potential sales from big spenders in Europe. A more pressing concern than the grant of funds, however, is the approval of the entire export plan for 2014-2016, which was submitted by the private-public Export Development Council (EDC) to the President last December.
Ortiz-Luis said they have yet to receive word from Malacañang on the status of the plan. The plan is crucial for the growth of local exporters, as it lays down the projections and strategies of the export sector to catch up with neighboring countries.
He said even with the export growth of the Philippines reaching 9 percent in 2014 to outperform other Asian countries last November, the numbers are skewed, as competitors have larger economies, thus, triggering a base effect on growth.
“Four years ago we were overtaken by Vietnam, and their export growth now is 2.5 times faster than ours. We need that budget if we are to catch up with Vietnam,” Ortiz-Luis added.
In 2013 merchandise exports totaled $54 billion, translating to $543 per capita. Singapore is at $76,448; Brunei Darussalam, $28,190; Malaysia, $7,662; Thailand, $3,351; Vietnam, $1,479; Indonesia, $734; and Cambodia, $611. Philippines’s export per capita is superior only to those of the Lao People’s Democratic Republic ($390) and Myanmar ($185).