July 12, 2022

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PCCI notes deteriorating business conditions due to energy costs, logistics

THE Philippine Chamber of Commerce and Industry (PCCI) said business conditions have deteriorated for exporters due to rising energy costs and logistics bottlenecks.

PCCI Vice-President for Industry Affairs Ferdinand A. Ferrer said during the launch of the 48th Philippine Business Conference and Expo (PBC&E) in Manila on Tuesday that “Exporters have been hit with high energy costs, high logistics costs, as well as supply chain disruption. It’s very taxing now, very challenging for exporters. It is not only in the Philippines that it is happening. It is happening globally. So, whether you are in Asia, Europe, or in other parts of the world, every manufacturing or export-oriented business is experiencing (this),” Mr. Ferrer said.

“The cost of doing business now has increased. We have to find ways to be more competitive versus our neighbors. Our neighbors are also in the same boat in trying to attract investors. We have Vietnam, Thailand, and Indonesia. That’s where we really need to gear up,” he added.

Mr. Ferrer, who is also the chairman of the Expo, added that many exporters are on the lookout for measures to soften the blow from their energy and logistics bills.

“The impact of high fuel charges has significantly increased the cost of manufacturing not just in the Philippines, but all over the whole world. We’re on a level playing field, but for companies, it is a painful burden to pay. Everybody is trying to look for innovative ways on how to save,” Mr. Ferrer said.

“Logistics costs are also very expensive. Not just the fuel. To send cargo… from here to the US… it is three and a half times (pre-pandemic levels),” he added.

“We hope that in the next six months, conditions ease up. But right now… we don’t see any relief from the Ukraine-Russia conflict,” Mr. Ferrer said.

Separately, Mr. Ferrer projected the gross domestic product will grow by 6% to 6.5% in the second half, with 8% growth attainable if face-to-face classes resume.

“We’re really opening up already. More businesses are confident. We are all traveling locally now. We are all spending again. All of us. I think the comfort level is getting better and better,” Mr. Ferrer said.

Mr. Ferrer added that the chamber “wants to work with the new administration as partners. It cannot be government alone or businesses alone. It should be together.”

“The weight of boosting the economy shall not be carried solely by the government. The business community will be its trusted anchor to keep the Philippine economy afloat as we have always been,” he added.

PCCI President George T. Barcelon said that he is hoping that the first State of the Nation address of President Ferdinand R. Marcos, Jr. on July 25 will reveal the outlines of the government’s plan.

“We hope that we can hear more specific deliverables… on the side of job creation and how we can attract more foreign investment not only in manufacturing but even in the agriculture sector,” Mr. Barcelon said.

“The other issue that we would really like to hear is ease of doing business, streamlining (transactions with government) to make operating business easier,” he added.

The PCCI will be hosting the 48th PBC&E on Oct. 19 and 20 at the Manila Hotel.

“The 48th PBC&E will be looking at how the new government will build on reform measures to strengthen the country’s economic gains… and make a real difference to the economy and the Filipino people,” the PCCI said. — Revin Mikhael D. Ochave