Exporters are pushing Congress to pass several economic and trade-related bills needed to sustain the rebound in exports amid the continuing weakness in the global economy, as they also hope for the renewal of some trade preference programs that help the country maximize overseas market openings for its products.
During the National Export Congress 2023, Philippine Exporters Confederation Inc. (PHILEXPORT) president Sergio Ortiz-Luis Jr. said the Corporate Recovery and Tax Incentives for Enterprises (CREATE) Act requires much-needed amendment, mainly on the value-added tax (VAT) zero-rating provision.
Ortiz-Luis said that after the House Committee on Ways and Means approved to revive the VAT zero rating on local purchases by local suppliers accredited by the Department of Trade and Industry-Export Marketing Bureau, they expect the same favorable results when a counterpart Senate bill is drafted.
He said exporters are likewise optimistic about seeing some game-changing results with the approval of amendments in the Magna Carta for micro, small and medium enterprises (MSMEs) as this facilitates development funds from SB Corporation to fund MSME projects.
“On the other hand, there are regulatory mandates we need to sort out with a couple of agencies so that the National Quality Infrastructure law based on international standards can be passed,” he said.
Ortiz-Luis cited other urgent and critical bills, including the amendments in the charter of the Philippine Ports Authority to decouple its regulatory and development functions and lessen the cost of shipping goods; Open Access in Data Transmission Act to liberalize internet access; and Customs Amnesty Act, both as a revenue generating and business-friendly measure.
“We could not emphasize more than the importance of getting these reforms passed as part of the conditions within which export growth and targets under the PEDP (Philippine Export Development Plan) are connected,” he said.
This as exporters’ advocacies continue as well with the Executive branches for reforms that will make access, quality and cost of power business- and consumer-friendly, he added.
Ortiz-Luis also said export stakeholders are awaiting the renewal of the country’s European Union Generalized Scheme of Preferences Plus (GSP+) privilege which will expire this year, and that of the United States GSP program which ended in 2020.
“Some of our best bets as we take advantage of these trade privileges include electronics, Halal products and services, the Creative sector which is getting a boost from its law approved in July last year, fresh and processed food, organic and green products, coconut-based goods, and the high-level and intensive global and investment campaigns led by no less than President (Ferdinand) Marcos (Jr.),” he said.
During the fourth quarter general membership meeting of the PHILEXPORT, Ortiz-Luis reiterated the likelihood of missing this year’s export target of USD126.8 billion as agreed in the PEDP launched in the middle of June this year.
“This target reflects a growth of 46.64 percent over the 2022 level, assuming that trade policies, programs and other collaborations for projects and programs would help achieve the goal,” he said.
Actual export receipts last year amounted to USD78.84 billion, 5.6 percent higher than the 2021 performance of USD74.7 billion.
He said the country may not hit this year’s target as year-on-year export receipts in August and September, supposedly peak periods already for holiday consumption, dropped at over 6 percent attributed to the general global market weakness.
“Inflation and higher interest rates are not helping boost domestic prospects either. Nor are the many other regulatory and other bottlenecks that PHILEXPORT, working with the EDC (Export Development Council) and other partners, are trying to help address for the industry and specific sectors,” he added.
