MANILA, Philippines — A local trade association of exporters is expecting exports revenues from consumer durables such as furniture and handicraft to end up lower by $100 million or about a fifth this year, citing local hurdles and foreign competition.
Robert M. Young, president of the Foreign Buyers Association of the Philippines (FOBAP), said they have estimated that their exports of hard goods will reach $400 million in 2024, which is 20 percent lower than the $500 million they recorded last year.
“To add, hard goods declined some 15 percent to 20 percent in 2023. Some of the Philippine production orders were transferred to Indonesia,” Young said in a message sent to the Inquirer.
The FOBAP official added that three of their members have re-positioned almost half of their durable goods production to Indonesia.
He cited higher production costs and lack of raw materials, as well as structural challenges in the Philippines, as the main reasons for the shift.
Lower export expectations
Young added that these have caused their projections to be “not as promising” this year, noting that a good volume of the order for these goods have been diverted to other countries which also have the capacity to manufacture the same products.
READ: PH hopes to grow export revenues by at least 10% in 2024
Philippine exports in 2024 are projected to fall short of the government and industry target of $143.4 billion, with both parties now planning to set a new goal reflecting the changes in the global market.
In 2023, the local export industry also fell short of the $126.8 billion target set under the updated Philippine Export Development Plan (PEDP, which was launched in mid-June of last year, but still managed to post a record by breaching the $100-billion mark.
READ: PH exports of goods, services breached $100B in 2023
The Philippines’ export revenues reached $103.6 billion last year, marking a 4.8-percent growth from $98.83 billion recorded in 2022.
According to the Department of Trade and Industry (DTI), the growth seen in 2023 was driven largely by the information technology and business process management (IT-BPM) and tourism sectors.