Cebu is well known for custom-made furniture such as these pieces from Metamorfose but the furniture sector is feeling the brunt of a global slowdown.
(CDN FILE PHOTO)
Export sales were down in the first five months of this year, but Philexport Cebu hopes to recover towards the end of the year.
Federico Escalona, Philexport Cebu executive director, said they noticed an increase in the number of export documents filed in June although July figures are likely to be flat.
“Based on our day-to-day statistics, June saw a pick-up in exports. July might not show a similar pick-up or might possibly show a decrease, but this has yet to be reviewed completely,” he said. Results for July will be up a week into August.
Escalona said the exporters remain hopeful that they can recover the losses from the first five months. Sales are traditionally stronger in the last three or four months of the year, he added.
As of May this year, the Philippine Statistics Authority (PSA) reported that merchandise exports for the first five months went down by 5 percent to $23.526 billion from $24.772 billion in the same period of 2014.
In May alone, export sales decreased 17.4 percent to $4.899 billion from $5.932 billion in May last year. The PSA said seven out of the top 10 commodities for the months posted negative growth.
In Central Visayas, Escalona said exports went down by 7.6 percent for the first five months of the year.
“There is a slowdown in demand from our international markets,” he said. Cebu exporters ship their products mostly to the US, Japan and Europe.
“Each market has had or is having its own difficulties, which has affected us in turn,” he added.
He cited the strike at the Los Angeles port, the deflationary pressure in Japan and the Greek debt crisis that has caused instability in the European markets.
Escalona said the furniture, gifts, decors and housewares (GDH) and fashion accessories sectors felt the slowdown. Locators at the Mactan Economic Zone also reported weak sales.
To minimize the impact of external shocks, Escalona said government should ease regulations on the export sector.
“Export is over-regulated. We have new laws, new regulations, new rulings on export,” he said.
He said government is addressing the exporters’ concerns, “but the government agencies responsible should hold no turf wars and work with each other,” he added.