The Philippines: Exporters told to take advantage of Chinese market

WITH China's rapidly growing middle-class market and increasingly affluent lifestyles, the government urged Filipino exporters to look for opportunities in this nation of 1.3 billion.

This developed as the Association Southeast Asian Nations (Asean) that includes the Philippines has become the largest trading partner of China resulting from the creation of China-Asean Free Trade Area (CAFTA).

"The economic surge of China is a manifestation of prospects it may bring to the Philippine economy," said Romleah Ocampo, supervising trade industry development specialist of the Center for International Trade Expositions and Missions (CITEM).

She said that China is expected to import more from its Southeast Asian partners to meet the required inputs for its production processes needed to support further expansions.

Ocampo particularly identified agriculture, furniture, and garments sectors that offer opportunities.

Philippine products that are fast becoming popular in China include crab paste, laing, banana chips, polvoron, mango, calamansi, coconut juices, purees, and concentrates.

Prospects are also seen for Philippine farm and fishery exports like tuna, lapu-lapu, shrimps, and virgin coconut oil and other coconut products.

While China is considered the world’s biggest exporter of furniture, Ocampo said Filipino exporters can still bring their goods there owing to the real estate boom.

To effectively penetrate China's lucrative market, local furniture makers can find a niche by supplying furniture parts or high-quality and well-designed furniture, she added.

This can also be said for the clothing sector since China's garment industry is reportedly weak in terms of sophistication and design development.

"To tap these prospects more effectively, CITEM and DTI (Department of Trade and Industry) should take a closer and more serious look at China as a more viable market for the country's export revenue streams," Ocampo said.

The Philippine Embassy in Beijing reported to the Department of Foreign Affairs (DFA) that trade between the Philippines and China posted a 32-percent annual growth from January to October 2011.

Embassy Charge d' affaires Alex Chua said the statistics indicate the "strength, resilience and potentials of the trade and economic ties between the two countries."

From January to October, Philippine exports to China reached $14.6 billion while Chinese exports to the Philippines topped $11.4 billion, expanding by 21 percent and 50 percent, respectively.

At present, trade between the two countries is dominated by electronic and electrical products, industrial parts, nickel/copper, liquefied petroleum gas, fertilizer and ceramics.

Philippine-China trade reached its highest level in 2007, with US$30.6 billion, before contracting in the next two years as a result of the global financial crisis.

CAFTA, which became fully operational in January 1, 2010, created a free trade area with 1.9 billion consumers and a total trade volume of $4.5 trillion.

Other Asean members that are expected to benefit from trade and investment opportunities offered by China are Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, Singapore, Thailand and Vietnam.