Modest growth seen for PH garment exports in 2023
A local trade group is eyeing modest growth in the Philippines’ textile and apparels exports this year amid the looming shadow of recession in key overseas markets, which include the United States.
The Foreign Buyers Association of the Philippines (Fobap), an organization of buyers and exporters of garments, said this despite expectations that these global headwinds will worsen this year.
“We are still hoping for a [modest increase] of 3 to 5 percent in the textile and apparel sector, with the spill over orders of other countries’ as they tend to reject small orders,” said Fobap president Robert Young.
Young added that they are also expecting the local garment sector to benefit from the relocation of some garment producers in China to other states in the Association of Southeast Asian Nations region, including the Philippines.
According to news reports from some western media outlets, analysts and industry experts have projected that the US will enter into recession this year, stemming from the continued policy rate hikes of the Federal Reserve in its attempt to quell inflation.
Last year, Young said that fears of a recession have dampened consumer spending in key markets, most notably in the United States, causing a parallel decline in orders from foreign clients.
The Philippine garments and textile industry exports are valued at around $1.5 billion annually according to Young.
Key export markets include the United States and the European Union, as well as a number of countries in the Asian region.
As for expectations on the Philippine economy, Young said that they are expecting the country to have a mild to low-mid recession, reasoning that the Philippines is not entirely trade-driven but also a remittance-driven economy.
For the meantime, the Fobap official said they are praying that authorities will have an urgent response and solution to the recent fiascos, including that of the air traffic mess at the Ninoy Aquino International Airport.
The airport, which serves as a crucial gateway to Metro Manila, experienced power outages and “tech glitches” according to authorities, prompting flights to get cancelled, delayed or diverted on New Year’s Day.
Young also urged the government to act on prevailing prices of goods, which he described as “ridiculously high.”
“It’s a bad signal to international businesses,” said Young.
The Philippines’ inflation rate climbed to 8.1 percent in December from 8 percent in November, bringing the 2022 average to 5.8 percent according to the Philippine Statistics Authority. INQ
