Development of new export markets pushed
The Bangko Sentral ng Pilipinas urges Filipino exporters to intensify efforts in developing alternative markets and to invest more in enhancing the quality of their products, with demand in industrialized countries seen to remain weak for an extended period.
Demand for products from the Philippines and other emerging markets has slowed down this year as the United States and eurozone continue to suffer from the ill-effects of their fiscal problems.
Although the industrialized Western economies have implemented stimulus, the results fell short of the expected pace of recovery.
The BSP said Filipino exporters should step up efforts to improve competitiveness.
“They should be competitive both in terms of the quality of the goods they sell and in developing new markets for their products,” BSP Governor Amando Tetangco Jr. told reporters.
Tetangco made the statement as the inter-agency Development Budget Coordination Committee (DBCC), which sets the government’s macroeconomic targets, started considering cutting the government’s 10-percent export growth target for this year.
Latest export data from the National Statistics Office showed that the country generated $29.19 billion in export revenue in January to July this year, up by only 3.3 percent from $28.25 billion in the same period last year.
The slower-than-expected growth in exports in the first seven months was attributed largely to the soft demand from the United States and Europe, the Philippines’ biggest export markets.
Export to the United States accounted for about 14 percent of the total, while exports to Europe accounted for about 17 percent.
Some exporters have asked the BSP to intervene more in the foreign exchange market, specifically by buying more dollars to deliberately weaken the peso.
However, according to the BSP, its policy does not favor a weak or strong peso. What matters is that volatility of the peso is tempered so that disruptions to business are minimized, it said.
The BSP admits it buys or sells currencies in the market, but only to prevent a sharp and sudden drop of the peso.
