The government intends to tweak the country’s export strategy by pushing for a further penetration of the Chinese market and focusing less on electronics, aiming to reverse last year’s contraction in export earnings that followed the changes in the global economic landscape.
The nearly 7-percent drop in exports last year was attributed to the decline in demand for electronics and other non-essentials from advanced Western economies, which had been key markets for Philippine-made goods, as they suffered from debt and economic woes.
Economic Planning Secretary Cayetano Paderanga Jr. said the Philippines has to wisely react to developments offshore to minimize the ill-effects of unfavorable external developments on the domestic economy, and doing so entailed revising the way the country did its export business.
“There is also an urgent need for the government to diversify our exports base,” Paderanga said Friday night in a speech delivered during the induction ceremony of the 2012 board of the Economic Journalists Association of the Philippines (EJAP).
Paderanga, who is also director general of the National Economic and Development Authority (NEDA), said the Philippines has to take advantage of the intentions of China, the world’s fastest-growing economy, to become more import-oriented. He said the Philippines has to look for ways to increase its exports to the giant Asian neighbor to benefit from the new mindset of China.
China, which has been keeping its currency weak as it aims to keep its exports relatively cheap and thus more affordable and competitive, is reported to be focusing on boosting domestic income as a source of growth and this is seen to cause a rise in its import demand. The changing strategy of China is anchored on the weak global demand over the past few years due to the crises suffered by Western economies.
China has been one of the major markets for Philippine-made goods. The United States and the eurozone account for about 15 percent of Philippine export earnings.