I think the government prefer importing rather than exporting is because we can’t produce that much. besides some of our products are not as competitive as those from the other countries. In business, there’s no point in competing with prices alone.

Plus the asset of our country in manpower, that’s why we can consider dollar earning Pinoys as imports, that includes call center agents.

What happens in Japan is that there currency is going down and while the cost of living is going up, the salaries are too, and they don’t have to worry on things like low purchasing power ‘coz they could produce what they need internally, they don’t have to rely largely on imports. But this is not the case in our country, coz we are dependent on imports, I guess. and so the government has to work on increasing the purchasing power of our currency. magulo ba?

But the government doesn’t see the local exporters with a blind eye, even if the weakening of the dollar [due to the subprime crisis in the US], is out of their control, they are still working on reducing the rate of appreciation so it won’t be really that detrimental to the exporters and give them enough (?) time to adjust and be ready to face a heightened competition in the international market. But the years of attractive export prices have served its purpose and became a bridge for the local exporters to position themselves in the said market, IOW, may mga koneksyon na at goodwill sa mga dayuhan. kaya somehow, they can still survive, even after the drastic appreciation of peso.

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When asked about the relationship of the weakening dollar and oil price:
The weakening of the US dollar actually helps in holding the oil prices up to some degree. Oil products are imports, so the local oil companies pay them with dollars. With the appreciation of peso, meaning the value of peso going up, thus increase in purchasing power of our currency. The problem with oil prices and why it is not affected by the appreciation of peso is because of the supply of oil from other countries, and the political conflicts present in oil producing countries. Moreover, oil markets are like stock market, the prices are decided based on speculations. If the suppliers think that their will be a shortage on oil supply then they would price the per barrel of oil higher. Or if the buyers and sellers think that there would be another political unrest in the country that they are extracting oil from that will surely affect the extraction and their operations in the said country then they would likewise price their oil higher. I’ve read several articles regarding how local oil companies cope up with the problem and read nothing about any problem with the Philippines that affects the price of oil.