By Kris M. Crismundo
MANILA, March 13 (PNA) — The decrease in oil prices that will result to lower prices of electricity and production cost to exporters will keep afloat exports revenue this year amid the strengthening local currency.
Department of Trade and Industry (DTI) secretary Greogory L. Domingo told reporters Friday that exports growth may slow down this year with strengthening of the Philippine peso against euro and yen.
“Exports may grow slower than initially anticipated because of the severe depreciation of European and Japanese currencies,” Domingo said adding that exports revenue at end-2015 is expected to increase by 10 percent versus last year’s earnings.
He mentioned that euro depreciated by 35 percent while yen declined by 20 percent against peso in a 12-month period.
Japan and Europe are major exports destination of the Philippines, having the former as the largest export partner of the country.
On the other hand, Philippine peso against U.S. dollar slightly appreciated.
On Thursday, trading between the two currencies ended at Php44.25 versus a U.S. dollar from Wednesday’s closing at Php44.34.
Stronger peso versus euro, Japanese yen, and U.S. dollar means lower revenue for exporters in terms of local currency.
Domingo said exporters’ threshold on currency exchange is up to 5.0 percent movement (appreciation or depreciation) for a year.
“If it goes up, there’ll be some effect on growth,” he said.
But the trade chief is still optimistic that the lower oil prices will keep up the exports growth for this year.
Aside from the lower pump prices, going for higher value-added products will still make exports receipts grow. (PNA)