Tourism to drive growth in service exports

MANILA, Philippines — The umbrella organization of exporters in the country is banking on the tourism sector to help drive growth in service exports amid the weak performance of merchandise exports. 

Philippine Exporters Confederation Inc. president Sergio Ortiz-Luis Jr. said tourism, identified by the government as a “low-lying fruit,” has been included in the sectors which may contribute to growth in service exports.  

“We are also rooting for tourism. Although based only on its growth rate in 2016 to 2017, tourism-related services exports surged by 35 percent, twice that of BPO, emphasizing its potential,” he said. 

By promoting the tourism sector, Philexport expects to not just allow visitors to see the Philippines as a tourist destination, but to also help reduce poverty and create jobs. 

The growth in the country’s service exports has been mainly driven by the BPO sector. 

Ortiz-Luis said the strong growth performance of the services sector started in 2015 due to the rising information technology and BPO sector which generated 1.2 million jobs and $22 billion worth of revenues.

He said the IT-BPO sector could overtake the overseas Filipino workers’ remittances if it could rise by 15 to 18 percent annually. 

Apart from tourism and IT-BPO, other sectors which form part of the country’s service exports are freight, construction and audio-visual materials. 

Data from the Philippine Statistics Authority showed the country’s merchandise exports were valued at $34.40 billion as of end-June, down slightly from $34.11 billion a year ago.

Trade Secretary Ramon Lopez expects exports of both service and merchandise to post low single-digit growth this year with outbound shipments of goods seen to be affected by the ongoing trade war between the US and China. 

Under the Philippine Export Development Plan, total exports covering merchandise goods and services are targeted to grow by 5.16 percent to 8.19 percent to reach $93.7 billion to $96.4 billion this year. 

Last year, the country’s total exports rose by nearly three percent to $89.1 billion from $86.6 billion in 2017.