Spider chair in powder-coated aluminum by University of the Philippines-educated Jinggoy Buensuceso. Exporters must focus on product design as well as quality to win buyers amid tight competition in the world market, according to the Department of Trade and Industry. PHOTOS BY NELSON MATAWARAN
MANILA, Philippines—Exporters must focus on product design as well as quality to win buyers amid tight competition in the world market, according to the Department of Trade and Industry (DTI).
Trade Secretary Gregory L. Domingo said in a statement that exporters had to regularly come up with new products or “products that excite.”
“This is what will distinguish us in the foreign markets,” Domingo said.
Domingo noted that non-electronics exports have been able to compensate for high cost of inputs including labor (which is one drawback for exports) through products made with design and craftsmanship by locals.
“Our biggest asset is the people. It is known not only in the Philippines but among our neighbors, and to a certain extent beyond our neighbors, that the Filipinos are creative. We are very good designers. We like to innovate, think of new things and apply different colors,” Domingo said.
However, contrary to previously held assumptions, cheap labor is becoming a thing of the past in the Philippines, according to the DTI.
The department said the Philippines, particularly Metro Manila, is the second-most expensive in Asean when it comes to labor cost, next to Singapore.
“Our labor cost is higher than Thailand and Malaysia. These two economies are significantly more advanced than the Philippines, and yet our labor cost is higher,” Domingo said.
Public and private sector officials noted that the share of non-electronics (including housewares, furniture, giftware, and food products) in merchandise exports are growing even though electronics currently takes up about half of outbound shipments.
Philippine exports increased by 7.2 percent for the January-September 2012 period despite weakness in electronics, according to data from the National Statistics Office.
Trade Undersecretary Cristino Panlilio said at the National Export Congress in Pasay City that despite concerns earlier this year about a sluggish global economy, the department wants the exports sector to garner at least $52 billion to $53 billion in revenue by the end of the year.
“That way we will hit an all-time high in our exports history,” Panlilio said.
The trade official said the government, together with industry associations, wants to exceed the $51.4 billion merchandise exports posted in 2010 and which went down to about $48 billion in 2011.
Philippine Exporters Confederation (Philexport) president Sergio Ortiz-Luis Jr. told reporters that about 9 to 10 percent growth from 2011 is achievable and exporters are still working to improve competitiveness.