In rebuilding Visayas, DTI seeks US trade perks

A typhoon survivor takes a bath beside donated tents at typhoon-ravaged Tolosa town, Leyte province, on Dec. 9, 2013. The Department of Trade and Industry will seek duty-free access and preferential treatment for garments to be exported to the United States, particularly for products that will come from areas devastated by Supertyphoon “Yolanda.” AP

MANILA, Philippines—The Department of Trade and Industry will seek duty-free access and preferential treatment for garments to be exported to the United States, particularly for products that will come from areas devastated by Supertyphoon “Yolanda.”

The move was meant to encourage labor-intensive industries, like the garments sector, to set up factories in storm-ravaged areas, such as in Tacloban, Leyte, to generate much-needed employment for affected residents, Trade Secretary Gregory L. Domingo said in a briefing on Wednesday.

“[Philippine Ambassador to the United States Jose L. Cuisia Jr.] and I have already talked, and we will pursue this. We will make the necessary consultations with the US Congress to see if it is possible. If it is possible, then we will come out with a draft bill and look for sponsors in the US Congress for our exporters’ duty-free access to the US market,” Domingo explained.

According to the trade chief, the DTI has already talked to the garments industry and learned that some companies would be willing to hire up to 2,000 workers.

The garments firms have also pledged to provide housing and other necessary benefits for the new workers.

“We’re trying to talk to the garments firms to put up factories in the area. Their only concern is the wage differential because, right now, we will need some form of subsidy per worker to bridge that gap. The minimum wage in Samar and Leyte is about P225. But to make the garments’ businesses in the areas [more competitive], the wage should be about P200. We’re still trying to figure out how to fill that gap,” Domingo said.

The trade chief was quick to add that the duty-free access and special treatment being sought would be temporary in nature.

Local garments players are expecting a robust growth of about 30 percent next year due to the resurgence in demand for their products from the United States, Europe and parts of Asia, the Philippine Exporters Confederation Inc. had said.

In an earlier statement, Philexport had quoted Robert Young, president of the Foreign Buyers Association of the Philippines (Fobap), as saying that the projection could even be considered modest given the favorable developments that affected the local export industry. These include the rising costs in China and the suspension of certain trade benefits given by the United States to Bangladesh.

The inquiries that local exporters were getting this year were supposedly “indicative of the prospective increase in business next year,” Young had said.