In a manifesto addressed to President Arroyo, the Economic Managers, the Bangko Sentral ng Pilipinas and the Congress, the Philippine Exporters Confederation Inc. has urged its partners in government to adjust economic policies to balance the interests of other segments of the economy with the survival of the exporters and families of 8 million OFWs, who contribute up to R65 for very R100 of the total value of goods and services produced by the economy every year.

Philexport led by Sergio Ortiz-Luis said that export enterprises have been hurting badly as a result of the continued rise of the peso’s value.

"We, the Filipino exporters, wish to express our grave concern over the abrupt rise in the value of the Philippine peso against the U.S. dollar in the past few weeks from P56 to in the third quarter of 2005 to P51 to the dollar today," their manifesto said.

Philexport, which represent the country’s various export-oriented sectors, particularly noted the plight of the small and medium enterprises that are using indigenous raw materials and food products as they are now facing the clear and present danger of losing tens of thousands of local jobs, if not closing down.

"Even the large enterprises in the semiconductor, electronics, garments and machine parts industries are losing their competitiveness as their margins get steadily eroded," the manifesto said.

Philexport further lamented that the strong appreciation of the peso against the dollar comes at a time when the industry’s clamor for urgent reforms and institutional support from government for faster export growth raised during the National Export Congress of August 2005 are yet to be realized.

During the National Export Congress, exporters have asked for substantial funding for export promotions, better access to credit for SMEs, amendment of the Customs Brokers Act, upgrading of strategic infrastructure including highways and ports, the high cost of electric power, and red tape in the processing of business-related papers.

Exporters also further urged the economic managers, BSP, Congress and President Arroyo to set in place the policy and institutional reforms, and roll on the infrastructure support projects earlier committed to avert reversals, if not the collapse of two of the strongest pillars of the economy, exports and OFW remittances.

The Philippine Chamber of Commerce and Industry (PCCI), the country’s largest business organization expressed mixed reactions on the rapid appreciation of the peso in the last two and a half months where the peso had substantially increased by 8 percent.

PCCI president Donald Dee cited the government’s effort in handling the affairs of the state, such as its political will in pushing for the EVAT law and the measures it took to handle the recent political disturbance, which has gained positive response from the investing community.

Business confidence in the country has been restored, Dee said, as can be seen from the strength of the peso and the continued gains in the stock market.

However, Dee expressed concern on the large movement in the exchange rate, whether on an appreciating or depreciating peso, which will create dislocation in the economy.

"An appreciating peso certainly will reduce our interest expense and oil bills. On the other hand, it also has the negative effect of making our exports uncompetitive, which ultimately might impact on our ability to maintain present jobs in the economy much less increase in creating jobs. We also must consider the effects of a strong peso on the families of our OFWs who now will receive less peso for the same dollar income remitted," Dee said.

"There is a need therefore to moderate the fluctuation of the currency to avoid speculation and serious impact on the viability and competitiveness of our exporters, and we need government intervention to achieve that," he said.

Dee said the government adopts policies to moderate exchange rate and assist our exporters maintain their viability and competitiveness, make available rediscounting windows, give incentives to modernize facilities to increase productivity, improve infrastructure to reduce transport costs, and other measures to mitigate the revenue losses of exporters, Dee said.

Dee said the business sector needs government to intervene and help control the exchange rate for the country to achieve stability in the economy, to further enhance economic growth and development.(BCM)