Exporters seek ‘contingency list’ in investments plan

EXPORTERS are seeking the reinstatement of a “contingency list” in the 2010 Investment Priorities Plan (IPP) to allow them to recover fully from the global economic slump.

In a statement, the Philippine Exporters Confederation Inc. (PHILEXPORT) said it submitted to the Board of Investments (BOI) a position paper that sought the retention for another two years of the contingency list as “exporters failed to take advantage of the incentives last year.”

PHILEXPORT said the new list may be called “Export Recovery List” to include activities that would reinstate laid-off workers in the first year, create jobs in the second year; corner new markets in Asia and elsewhere, and regain lost markets in Europe, Japan and the US.

The contingency list was included in the 2009 IPP to aid companies that have kept and/or increased investments and/or employment amid the global crisis.

The BOI removed this list from the draft 2010 IPP, citing a pronouncement by the National Economic and Development Authority that the “worst is over” for the Philippine economy.

PHILEXPORT, however, said that many exporters could not avail of the tax incentives and other perks for their export activities last year, as they were unable to ship out 70 percent of their production abroad.

The group said the global slowdown resulted in cancellations of orders by many foreign buyers, so exporters instead sold most of their products to the domestic market.

PHILEXPORT asked BOI to suspend the 70-percent export requirement starting this year until next year to support the sector’s recovery.

The group said it also submitted a resolution asking the Bangko Sentral ng Pilipinas to “rethink” its policy, which is geared towards strengthening the peso.

PHILEXPORT said the strong peso has a “devastating impact” on exporters, as their goods and services become more expensive—hence less competitive—in the global market.

“That belief in a strong peso driving a strong and vibrant economy has not worked well for the country,” the group said. –BEN ARNOLD O. DE VERA Reporter, Manila Times