Rising protectionist policies leading to trade wars are not likely to deter food and plastic input manufacturer D&L Industries from growing its export business to hit the targeted share of 50 percent of total business over the long term.
Speaking to reporters on the sidelines of D&L’s stockholders meeting on Monday, D&L president Alvin Lao said the group’s plan for the export business—which accounted for 22 percent of total in the first quarter—would not be affected by political developments.
Talks of trade war between the United States and China and other economic giants have caused jitters among investors in recent days.
“At the end of the day, we answer to a lot of business needs that are very fundamental and none of our products are politically sensitive, so I don’t believe there’s going to be any major effect,” Lao said.
In general, anything that could affect the pricing of food artificially, such as tariffs and duties, would gnaw on demand.
“But I don’t believe what we sell are going to be affected directly. And even if there’s an indirect effect, it’s going to be quite small,” Lao said.
Three years ago, D&L already started talking about growing its export earnings to account for 50 percent of total business. “But it’s a long-term goal, maybe 10 years. It looks like we have seven years to go,” he said.
In 2016, export earnings accounted for less than 20 percent of D&L’s business.
D&L’s partnerships with the likes of Ventura Foods and Bunge Ltd., alongside other foreign firms, are seen to help the company attain this goal.
“On the flip side, domestic business continues to grow so that’s part of the challenge: How do we keep our exports growing than our domestic business?” Lao said. —DORIS DUMLAO-ABADILLA