THE Department of Trade and Industry (DTI) is assessing a possible downgrade of the Philippines's export target this year amid the pandemic-induced shipment delays that have plagued local industry players for at least half a year already.

Trade Secretary Ramon Lopez said the DTI is looking into the current situation of the export-oriented companies to gauge the impact of the container imbalance on their operations and revenues.

"[We are] currently assessing impact and we shall revisit targets," Lopez told the BusinessMirror.

The trade chief said no revisions have been made yet after officials downgraded the projections under the Philippine Export Development Plan in January, given the recent surge in export revenues.

The Export Development Council, at the time, reduced the export target to at least $105 billion by 2022 from the original projection of $130 billion. Lopez explained that the revision was based on slowdown in production amid the mobility restrictions and dampened demand in the market.

The council, meanwhile, expects exports to reach $91.7 billion this year.

In addition, Lopez said that the impact of the lack of vessel space for shipments on relevant sectors is "not quite significant at this time."

Industry sources earlier told the BusinessMirror that the shipment delays amid a container imbalance started in the latter part of last year when demand started picking up. Delays in delivery range from two weeks to 45 days.

Philexport poll

In a recent survey by the Philippine Exporters Confederation Inc. (Philexport), 81.6 percent of the about 100 respondents said their products are ready for outbound shipments, but have remained pending amid container imbalances.

The exporters, furthermore, identified the following as their top shipping challenges: lack of space on international shipping lines (90 percent), increased freight rates (56.3 percent) and shortage of containers (45 percent).

The shipment delays are not only seen to consume time but to cut revenues of industry players as well, Philexport said previously. Garment industry leaders, for example, earlier told this newspaper they project as much as $600-million losses—accounting for 40 percent of their 2021 revenue target—this year if shipment delays persist.

The peak shipping season, which is the second half, is expected to exacerbate the current container crisis. The Supply Chain Management of the Philippines had previously warned that such delays will be experienced by the exporters even after Christmas.

Maintaining momentum

Lopez said exports are likely to continue improving after posting nearly 30-percent year-on-year growth in May.

"We are very optimistic that we can sustain this upward exports performance trajectory as our major trading partners continue opening up their borders and easing travel restrictions, given the success rate in their vaccination drive, the same thing here in the country as we rollout the vaccination program," the trade official said in a recent statement.

He added that manufacturing has been allowed in the country even during the enhanced community quarantine (ECQ) and modified ECQ, which helped in boosting production.

"As we focus our efforts on the key export sectors of our country, we hope to regain our lost opportunities due to the Covid-19 pandemic and maintain the momentum of accelerating our export growth," Lopez added.

Still, Philexport Chairman George T. Barcelon said earlier that the country's rebound in trading is being threatened by the government's Covid-19 response and supply chain concerns.

He cited the slow vaccination rollout, mobility restrictions and shortage of raw materials in certain sectors, in addition to shipment delays.

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