SOME segments of the export sector continue to struggle despite the positive data logged in the first seven months, which had been caused by frontloading to get shipments landed before new US tariffs took effect, according to the Philippine Exporters Confederation, Inc. (Philexport).
While electronics performed well, “this is not the same story for the bigger number of our other sectors that continue to struggle due to various reasons,” according to Philexport President Sergio Ortiz-Luis Jr.
At the Philexport general membership meeting on Tuesday, the association said exports grew 13.9% in the first seven months to $48.62 billion.
“The US continues to be our top trading partner, proving how important this market is, particularly for the electronics sector,” he said.
He said the University of the Philippines Center for Integrative and Development Studies (UP CIDS) is projecting that the Philippines could lose $2.2 billion in export revenue in the second half of the year due to the US tariffs.
“Most vulnerable are our labor-intensive exports such as garments, leather goods, wearables, furniture, and coconut-based products,” he said.
“We are thankful that at the moment, the market share of our high-value exports like electronics, semiconductors, and machinery products has been preserved in this new US tariff regime,” he added.
To help mitigate the effects of the US tariffs, the Department of Trade and Industry (DTI) has announced plans to launch a loan program for micro, small, and medium enterprises (MSMEs) affected by the tariffs and to broaden market access through free trade agreements.
“But in the meantime and until more resources are poured into the export industry and MSME development and major breakthroughs happen from our market diversification programs, we see a grim outlook on the US market, which accounts for about 20% of our total export performance,” Mr. Ortiz-Luis said.
“This may also have a chilling effect on our export revenue, which is already driving us to recalibrate our export targets,” he added.
According to Mr. Ortiz-Luis, Philippine exports need to be more competitive in terms of quality and compliance with standards.
Citing the United Nations Conference on Trade and Development, he said developing economies lose up to 25% of potential export value due to quality mismatches and failure to conform with international standards.
“Exporting without data is like sailing without a compass,” he said, adding that firms that harness data-driven market selection are more likely to sustain exports beyond three years.
“Using artificial intelligence-powered tools like Trademap or Market Access Map, companies can identify not only demand volumes but also competitor presence, tariff barriers, and sanitary/phytosanitary restrictions,” he added.
He noted that digitally-enabled exporters are growing five times faster.
Meanwhile, he expects the World Trade Organization’s Trade Facilitation Agreement to reduce trade costs by 14.3% for developing countries.
He batted for “electronic single window systems, risk-based customs inspection, and regional harmonization of standards and processes.” — Justine Irish D. Tabile