Cebu exporters seek exemption from wage hike

MORE Cebu exporters are seeking exemption from the P22 daily minimum wage increase recently approved by the Central Visayas wage board.

“The wage increase, continued strengthening of the peso, and high power rates combined are the signs of a perfect storm for us exporters,” said Mari Booth, Mehitabel Inc. vice president in an interview last Wednesday.

Booth and other exporters were at the City Sports Club last Wednesday for the presentation of the International Furniture Fair Singapore 2013.

Booth said the P20 minimum wage increase from last year added to the P22 increase that takes effect in December would increase their operation costs by 20 percent.

The wage increase pegged the minimum wage in Cebu City at P327 a day by midDecember.

Philexport president Venus Gensin said exporters felt orphaned because of lack of government support in the sector.

“The exporters have not fully recovered. Some have even lowered their operations just to hold on and these additional costs will really affect them,” said Gensin.

From an 1,000 employees in 2008, Mehitabel Inc. has reduced manpower to 350 to lower expenses.

“We have retrenched people to be able to cope. The situation is true to all exporters even in Manila. I know one which used to have 3,000 people and is now down to only 35 people,” said Booth.

Ruby Salutan of Cebu Furniture Industries Foundation said that another wage increase would hamper the recovery of the industry .

“We are awaiting the official memorandum this December and really hope that they will consider our situation,” said Booth adding that while other industries like tourism, real estate and retail are experiencing growth, this is not felt by exporters,” said Booth.

On the issue of currency, the exporters said the best exchange rate level would be P45 to a dollar.

“There was a projection that the exchange rate would still go down to P30 per dollar. That will kill all of us. We are barely managing now at P41. How much more at P30?” said Gensin.

While the government has acted on the power rate issue, exporters said that the government should do something to keep the exchange rate at a level that would benefit everyone including exporters and importers./Reporter Aileen Garcia-Yap