Saturday, February 10, 2007
Cebu furniture sector suffers loss, foresees more difficulties in 2007
CEBU furniture manufacturers and exporters foresee tougher times this year, following the closure of a total of 35 local furniture companies at the end of 2006.
Laurie Boquiren, member of the board of trustees of the Cebu Furniture Industries Foundation Inc. (CFIF), said that while there are new players in the market, some companies have decided to cease operations due to stiff competition in the global furniture industry, a decrease in the demand for high-end furniture, and the strengthening of the local currency against the US dollar.
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CFIF executive director Ruby Salutan said the closure of the 35 companies resulted in the displacement of about 2,500 local workers.
Cebu’s furniture manufacturing industry is composed of 300 firms that directly employs 80,000 and provides indirect employment to 140,000 individuals.
In a press conference last Thursday, CFIF president Michael Basubas said that while the Philippine furniture industry achieved growth last year, Cebu — which accounts for 20 percent of the whole industry — suffered a negative 2.2 growth.
But he said the decline was better than 2005’s negative five percent growth rate.
Research
“There’s no way to go but invest in research and development or lock your doors,” said Salutan, adding that this is the only way to cushion industry players from closing down and to prevent the exodus of quality designers to foreign countries.
“The only way to compete is by being more efficient,” she said.
Boquiren said the need to drive the competency of local furniture industry players, in terms of investing in researcg and technology as well as in honing new designers to come up with “winning items” to cater to the high-end market, are among CFIF’s long-term goals.
“New material manipulation is our edge against competitors like Vietnam and China since they find it very tedious,” she said.
According to Basubas, Cebu exporters, in general, need to put high regard on research and development, especially when targeting the European Union (EU) market as their next market destination.
He said a “thorough” understanding of the EU market will help build the confidence of many industry players in penetrating its “strict” standards.
Earlier, Jay Yuvallos, president of the Confederation of Philippine Exporters (Philexport) Cebu, said he is also encouraging Cebu-based exporters to “go back to the basics” if they want to truly penetrate new markets like the EU and North America.
Meanwhile, Basubas, Boquiren and Salutan lauded the deal inked among Philexport-Cebu, the Canadian government and the Netherlands Center for the Promotion of Imports from Developing Countries to help local exporters improve marketability and global competitiveness.
“It will help revive the industry,” Boquiren said. (MMM)
For Bisaya stories from Cebu. Click here. (February 10, 2007 issue)
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