MANILA - China's rise as an economic powerhouse is one of the key factors that propelled the Philippine export sector.
Philippine export revenues in 2010 soared to a better than expected 33.7 percent growth rate. With receipts hitting $51.39 billion - the first time since 2007 that annual revenues breached the $50-billion-mark.
The global recovery has resulted to sharp growth spurts between the Philippines and its trading partners. But Philippine export to China stood out, posting a 94.32 percent growth in export receipts in 2010.
Victor Abola, economics professor at the University of Asia and the Pacific, attributed this to the fast growing Chinese economy.
"Increasing domestic demand as well as the need of China to increase infrastructure to import more products," Abola said.
This include increased demand for minerals and metals like iron one, copper and nickel. He added the stronger purchasing power of consumers boosted demand for processed Philippine food products and fresh fruits like bananas
China has been increasing its global clout for the past few years thanks to its spectacular growth. With its economy valued at $5.8 trillion, China passed Japan as the world's second-largest economy behind the US.
The manufacturing boom fueled China's growth and its expanding domestic industries and infrastructure boosted demand for metals, farm produce and electronics. China has imported materials from Southeast Asian countries like the Philippines. In 2008, trade between China and the Association of Southeast Asian Nations ( ASEAN) trade peaked at $231 billion.
The establishment of the China-ASEAN Free Trade Area in 2010 has expanded bilateral trade. According to China's General Administration of Customs, China's imports from ASEAN increased 44. 8 percent to $154.56 billion last year. Bilateral trade rose 37.5 percent on year to $292.78 billion.
Philippine Exporters Confederation, Inc. President Sergio Ortiz- Luis said at the height of the global recession in 2009, the major markets for Philippine products like Europe, the US and Japan had to slash their imports. China's economy, on the other hand, was resilient and still managed to import from the Philippines.
Japan and the US are now the two biggest markets for Philippine exports. China stands as the Philippines third largest export market. But not for long, according to Ortiz-Luis.
He said only China, which continues to grow strongly, has the potential to expand as an export market for Philippine products.
"We project that in five years' time, it's possible that China will become the top destination for our products," Ortiz-Luis said.