MANILA, Philippines — The Department of Trade and Industry is proposing a P1-billion National Export Development and Competitiveness Fund for the next five years to push the country’s export sector to support the recovery of the electronics sector and sustain the growth momentum in the non-electronics exports.

Senen Perlada, director of the Bureau of Export Trade Promotion, an attached agency of the DTI, said that Trade and Industry Secretary Gregory L. Domingo is recommending this five-year fund allocation to the Cabinet economic cluster.

“We are trying to get P1 billion over the next five years to support our exports sector,” said Perlada, who is executive director of the Export Development Council. The export programs to be funded would include export promotion, capacity building, policies and studies.

The DTI would also be pushing for the institutionalization of the Export Development and Competitiveness Fund under the DTI budget. Initially, the government could set a contingency fund for the exports sector.

The P1 billion fund could be divided equally to P200 million annual allocation for the next five years.

Last year, the exports sector under the Export Support Fund received a total of P80 million of which P60 million was spent for the intervention measures for the food processing sector and P20 million for export promotion activities.

But since the exports sector is expected to recover this year from a slump last year, the government needs to come up with interventions and measures to sustain its recovery.

The electronics sector is expected to grow over 30 percent this year to reach $31 billion while the merchandize export is expected to contribute over $62 billion.

“We are confident that we still hit the absolute figure,” he said. The country's exports target for 2012 is $80.2 billion.

To compensate for the loss of revenues from merchandise exports, service exports must be increased, Perlada explained during a radio program interview.

Services exports, which include information technology and business process outsourcing, presently only accounts for 20 percent of our total exports. Electronics exports accounts for almost half of our total exports.

“This trend in the services exports will cushion the decline in export receipts and help us meet our targets in 2012,” he said.

While the passage of House Bill 3596 or “Call Center and Consumers Protection Bill” in the US Congress is seen as a threat in our country’s booming business process outsourcing (BPO) industry, Perlada said that “it will ultimately be a business decision on the part of the companies.”

“What we can do is to improve on the attractiveness of the Philippines as a destination of business process outsourcing,” he added.

He further added that Department of Tourism’s slogan “It is more fun in the Philippines” would include the promotion of trade and investment, not just tourism. Tourists are considered the first line of distribution of our goods and services. Similarly, they can also be investors in tourism.

“With the help of our tourism and commercial attachés abroad, we see a ramp in tourism investment in the Philippines” he said.

He mentioned that DTI has recently organized the so-called Global Marketing Intelligence Teams (GMITs), which is composed of eight (8) teams like America, South Asia, North Asia, Middle East and North Africa. The team do not just include DTI but also the Department of Foreign Affairs, Department of Tourism and Department of Agriculture and other agencies and stakeholders involved in international business. As composite teams, the GMITs will work together to harmonize our programs to make the most of our resources.

With the looming crisis in the US and Europe and Japan, Perlada said, “We will be expanding our exports to China, not just on Eastern sea port area but within its mainland.”

Likewise, countries where the Philipppines has free trade agreements (FTAs) such as North Asia, Japan, Taiwan, Korea, Australia and New Zealand were cited as strategic markets of our exports.

He further explained that fifty-seven (57) percent of our merchandise exports now go to these countries. So far, utilization of exporters of these FTAs with partner countries has reached 30 percent based on our discussions with the private sector but this may have to be validated by the Bureau of Customs.

In view of this, Perlada said that DTI will continue to conduct information sessions on doing business in FTAs to make our small and medium enterprises exporters understand and use the opportunities in these agreements. (BCM)