Garment manufacturers in the Philippines want more tax incentives and subsidies. They feel subsidies, particularly for labor and power expenses, will bring down the cost of doing business in the country. In the meantime corporate income tax is being lowered and the tax incentive system is being revamped.

The textile and garment industry used to be competitive globally and was considered a sunrise industry in the 1990s. Export performance, however, dropped since the abolition of textile quotas by the World Trade Organization in 2005. As a result, garment and textile enterprises in the Philippines that relied on quotas underwent difficulties, leading to the closure of factories and downsizing.

Garment manufacturers say once the sector is revived, the Philippines can penetrate more markets, especially Southeast Asia, aside from the United States. One opportunity they see is that neighboring countries such as Bangladesh, Vietnam, Sri Lanka and Myanmar are bursting with orders, have no more space for fresh new production and that this is the time for the Philippines to step in and take the opportunity. The US accounts for 60 per cent of Philippines’ garment exports. The rest are sold to the EU and Asian countries.