200,000 garments workers face job loss
Exporters press for trade pact; warn of dangers in next 3 years
200,000 garments workers face job loss
Ronnel W. Domingo Inquirer News Service
ABOUT 200,000 workers -- half of the garments industry's workforce -- are in danger of losing their jobs over the next three years due to competition with low-cost producers like China, an industry group said Wednesday.
The industry "would die" in the next few years because of higher labor and other input costs than in other Asian countries if it doesn't get preferential access especially to the United States market, the Confederation of Garment Exporters of the Philippines (Congep) said.
The US accounts for about 70 percent of Philippine earnings from garment exports, Congep executive director Maria Teresita Jocson-Agoncillo said.
Garments exports bring in an average of $2.8 billion a year, with shipments to the US reaching $1.9 billion.
"We want to work on negotiating a preferential tariff agreement (PTA) with the US, but this requires the involvement of our government," Agoncillo said.
The US levies three percent to 32 percent duty on shipments from the Philippines, she said.
"From the current average tariff of 17 percent, we hope to reduce this to zero through a garments industry-specific trade pact with the US," she said.
A comprehensive free trade pact with the US "would take time to realize," Agoncillo noted. "In the meantime, we need such preferential access before 2008."
Because of huge volumes of garments coming from China, the world's largest markets -- including the US, Canada and Europe -- are imposing quotas on Chinese imports until China becomes a member of the World Trade Organization in 2008.
The international Multi-Fiber Agreement, which laid out a global quota system for garments, expired at the end of 2004.
Agoncillo said the Philippine garments industry, which has 400,000 workers and generates a million jobs indirectly, is in jeopardy even with the safeguard measure against Chinese imports.
She said garments companies in the Philippines had decreased from 1,100 in 2002 to 950 at end-2004.
Cogep director Michael Que said a garments-specific PTA with the US could be likened to the qualified industrial zone (QIZ) scheme that the US has entered into with Israel, Egypt and Syria.
"However, the QIZ is different in that this involves a physical area that enjoys preferential trade treatment," Que said. "We are after preferential tariffs."
He said a PTA with the US could result in an inflow of investments of $550 million over the long term.
According to Congep estimates, a more immediate effect of such a pact would be a 20-percent increase in export earnings from the US market to about $2.3 billion a year.
"A PTA could also mean 100,000 new direct jobs yearly," Agoncillo said
200,000 garments workers face job loss
Ronnel W. Domingo Inquirer News Service
ABOUT 200,000 workers -- half of the garments industry's workforce -- are in danger of losing their jobs over the next three years due to competition with low-cost producers like China, an industry group said Wednesday.
The industry "would die" in the next few years because of higher labor and other input costs than in other Asian countries if it doesn't get preferential access especially to the United States market, the Confederation of Garment Exporters of the Philippines (Congep) said.
The US accounts for about 70 percent of Philippine earnings from garment exports, Congep executive director Maria Teresita Jocson-Agoncillo said.
Garments exports bring in an average of $2.8 billion a year, with shipments to the US reaching $1.9 billion.
"We want to work on negotiating a preferential tariff agreement (PTA) with the US, but this requires the involvement of our government," Agoncillo said.
The US levies three percent to 32 percent duty on shipments from the Philippines, she said.
"From the current average tariff of 17 percent, we hope to reduce this to zero through a garments industry-specific trade pact with the US," she said.
A comprehensive free trade pact with the US "would take time to realize," Agoncillo noted. "In the meantime, we need such preferential access before 2008."
Because of huge volumes of garments coming from China, the world's largest markets -- including the US, Canada and Europe -- are imposing quotas on Chinese imports until China becomes a member of the World Trade Organization in 2008.
The international Multi-Fiber Agreement, which laid out a global quota system for garments, expired at the end of 2004.
Agoncillo said the Philippine garments industry, which has 400,000 workers and generates a million jobs indirectly, is in jeopardy even with the safeguard measure against Chinese imports.
She said garments companies in the Philippines had decreased from 1,100 in 2002 to 950 at end-2004.
Cogep director Michael Que said a garments-specific PTA with the US could be likened to the qualified industrial zone (QIZ) scheme that the US has entered into with Israel, Egypt and Syria.
"However, the QIZ is different in that this involves a physical area that enjoys preferential trade treatment," Que said. "We are after preferential tariffs."
He said a PTA with the US could result in an inflow of investments of $550 million over the long term.
According to Congep estimates, a more immediate effect of such a pact would be a 20-percent increase in export earnings from the US market to about $2.3 billion a year.
"A PTA could also mean 100,000 new direct jobs yearly," Agoncillo said
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