Country: Philippines

Workers from textile and garment factories and allied sectors affiliated with IndustriALL Global Union participated in a Collective Bargaining and Negotiation Training Course that was held at Antipolo City from March 3-5, 2017.

The training, supported by Japanese union UA Zensen in cooperation with IndustriALL Philippines, aimed to equip skills and augment the capacity of plant level union officers to negotiate for better working conditions. 25 local union officers and shop stewards were equipped with negotiation skills and collective bargaining strategies and techniques.

According to the participants, when trade union and collective bargaining rights are attacked by corporate globalization, then there is always a need for new approaches to collective bargaining, and it becomes essential for trade unionists to acquire adequate skills and innovative negotiation strategies. “We are delighted to be a part of this training. As a newly formed union it is timely that we adapt to this new learning so that we can immediately apply in our coming negotiation,” remarked George Otayde, Vice President of Lamitek Labour Union, one of the participants.

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Union density and collective bargaining coverage are low in the Philippines, leading unions to look at various types of collective bargaining so that more workers can be covered by collective agreements. “Real changes happened in our workplace. Earlier almost all workers were covered by our collective bargaining agreement, but today contractual workers outnumber regular workers, and those contractual workers are excluded from our collective bargaining agreement,” underlined Roland Vicencio, Union Officer – Frankhaus International Corp., adding, “Now that we are aware that this situation will eventually lead to the loss of our bargaining power and weaken the union, it is a challenge for the union to exert our collective effort to negotiate for inclusive provision of all workers regardless of their status.”

Countries like Vietnam, Myanmar, Bangladesh and Cambodia are expeditiously making mark on the global apparel and textile industry by improving their productivity, incorporating latest technologies, reframing policies, and thereby making the international market even more competitive. Thus, to be among the leaders in global T&C industry, the Foreign Buyers Association Philippines (FOBAP) has asked for Government’s support in the growth of garments and hard goods sectors as it aims at group’s export sales of garments to hit US $ 1 billion in the year 2016, while of hard goods at a US $ 200 million.

The association informed that among the major roadblocks hampering growth of the Philippines’ garments and hard goods sectors are high power cost, wages and financing and that other Southeast Asian countries such as Myanmar, Cambodia and Vietnam partly subsidize power, wages and financing cost of their dollar-earning industries.

Also Read – Philippines Apparel and Footwear Market to touch US $ 4.5 billion-mark by 2019

FOBAP President Robert Young said, “The direction of the Philippine garments industry is towards the middle to high-end markets. The basic ones are not really any more attractive to the buyers because of obstacles and roadblocks that are present in the garment industry.” He further emphasized that the industries need to upgrade the skills of the workers as the machines being used by the neighbouring Asian companies are already advanced.

Along with that, FOBAP pushed for the country’s massive investment in infrastructural development to meet import orders along with improved and upgraded ports facilities to smoothen the export processes.

In its report – ‘Philippines Apparel and Footwear Outlook to 2019 – Increase in Influx of Foreign Brands’, Ken Research, a research analyst, has mentioned that apparel and footwear market of Philippines is expected to reach US $ 4.5 billion-mark by 2019 at a CAGR of 9.1%, with brands like Nike, Adidas, H&M, Forever 21 together with local brands – Penshoppe and Bench enthusing demand in the market.

The apparel and footwear market in the country has noted surge in growth in the past five years with rise in personal disposable income. Earnings from apparel and footwear market in Philippines have grown at a CAGR of 7.3% from 2009-2014 period.

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The analyst says, “While rise in disposable income, demand for international products and rise in e-commerce sales will result in increased spending on apparel and footwear products, stiff competition amongst manufacturers and retailers will drive down product pricing and would hence act as a major barrier for the industry.”

With the report being unveiled just before the New Year, it will surely help apparel and footwear manufacturers, retailers, department stores among others to formulate fresh market centric strategies in accordance with the expected future trends.

The Philippines must now move towards diversifying its export basket while balancing productivity and requirements of international social compliance norms, suggested Shanaka Jayanath Peiris , a resident representative of the International Monetary Fund (IMF). Foreign buyers’ representatives are urging local exporters and manufacturers to brace themselves for social compliance audits, noting the Philippines can lose as much as US $ 500 million in potential export revenues yearly due to non-compliance. Foreign Buyers Association of the Philippines (FOBAP) President Robert Young also urged the Philippines’ factories and sub-contractors of apparel, footwear and home furnishings to comply with social practices required by most major importing countries.

Philippines abaca fibre may witness growth of 5.7 per cent in global demand, as per the TechSci – global market research and consulting company. From January to August last year, Philippine abaca exports expanded by 57.4 per cent to US $ 79.3 million, from US $ 50.6 million recorded in the same period in 2013 on the back of sustained demand for the crop in the country’s major markets, the Fibre Industry Development Authority – an attached agency of the Department of Agriculture stated.

Following Philippines’ inclusion in EU’s generalized system of preferences (GSP+) last year, the country’s exports expect a 15 per cent surge. While the beneficiary status of exporting goods at zero duty has been accorded to over 6200 product lines, the apparel manufacturing sector is set to be the biggest winner. According to projections of Department of Trade and Industry, products that would likely post the highest increases given the country’s inclusion in the GSP+ scheme included textiles and garments (Euros 79.7 million), followed by footwear, headwear and umbrellas (Euros 28.5 million).

The Philippines has been granted Generalised System of Preferences Plus (GSP+) status by the European Parliament which will give duty free entry to the EU for some of the most important Philippine exports that also includes garments and textiles. The European Union provides GSP+ preferences covering over 6,200 tariff lines to create economic benefits that will help the Philippines to assume its responsibilities under core international conventions on human and labour rights, environmental protection and good governance. “This is very good news for the Philippines as it will bring tariffs to zero per cent for two-thirds of tariff lines including strategic products that the Philippines is already exporting to the EU. This will immediately translate into savings of tens of millions of Euros per year in foregone customs duties,” said EU Ambassador Guy Ledoux. According to data from the Industry and Trade Statistics Department, under the Philippine Statistics Authority, the exports of apparel and accessories from Philippines grew by 14.7 per cent to US $ 1.557 billion in January-October 2014, compared to exports of US $ 1.357 billion made during the corresponding period of last year.

Philippines based textile manufacturers are expecting 30-percent year-on-year increase in sales in the fourth quarter as a result of weakening relations between Manila and Beijing. The Textile Producers Association of the Philippines (TEXPAP) Chairman Luna Go said that sales of locally-made textiles and garments were expected to increase as many native Chinese textile traders based in the Philippines had returned to China. Additionally, many local manufacturers of ready-to-wear apparel, who used to rely on cheaper Chinese raw material, decided to source their textiles locally.