Exporters confident of recovery in second quarter

Despite slump in February shipments

MANILA, Philippines — The Philippine Exporters Confederation Inc. (Philexport) brushed off concerns over export prospects after merchandise shipments in February declined, halting 15 consecutive months of growth.

Philexport president Sergio Ortiz-Luis Jr. expressed confidence the downturn in exports would not linger as a recovery in the second quarter is likely on the back of higher global growth momentum.

“The weaker February performance could very well then be just the market reacting to tentative signals and certain policy pronouncements here and in major markets abroad,” he said.

The Philexport official is also optimistic the country’s exports will reach at least $122 billion in the medium or until 2022, representing an annual average of eight to 10 percent growth.

Citing the outlook of the International Monetary Fund, Ortiz-Luis said the export sector is expected to gain momentum from global growth which is expected to reach 3.9 percent until 2019.

He said the country has yet to see if there are actual adverse effects of the trade tensions between the US and China, which can disrupt global trade.

He noted that the electronics sector, however, has expressed concern about its possible impact.

Data from the Semiconductors and Electronics Industry of the Philippines Inc. indicated that China and the United States each accounted for more than 12 percent market share of the $32.7 billion all-time high export performance last year.

“This development may cast doubts on the possibility of a five percent export growth this year, although we feel that there can be a correction in the second quarter,” Ortiz-Luis said.

Ortiz-Luis cited combined government and private sector efforts to push export such as electronics, processed food and beverages and services sectors, as growth drivers in the months ahead.

He is also banking on benefits from preferential schemes like the US Generalized System of Preferences, which covers about 18 percent of Philippine exports to the country, or about $1.5 billion worth of exports in 2017.

The Philippine Statistics Authority earlier reported that the country’s merchandise export earnings contracted for the first time since November 2016 to $4.66 billion in February, down 1.8 percent from $4.74 billion in the same month last year, due to lower receipts from total agro-based products, manufactures and petroleum products.