A significant European apparel brand has withdrawn its multimillion-dollar orders from Philippine manufacturers, severely affecting local exporters already struggling with slow sales. 

The move, attributed to higher wages in the Philippines, prompted the brand to shift production to Vietnam and Cambodia, where labor costs are lower. The withdrawal is expected to impact 4,800 to 6,000 Philippine workers and lead to an annual revenue loss of $200 million to $300 million. 

The garment sector, employing about 2 million workers, holds substantial importance in the Philippine labor market and contributes around $6 billion in annual exports. The brand's departure highlights challenges in the Philippine garment industry, stemming from heightened competition from lower-wage countries and global demand stagnation. 

While the Philippine government has taken steps like tax incentives and subsidies to aid the industry, more comprehensive efforts are needed. 

The European brand's exit underscores the challenges facing local exporters and the broader Philippine economy, with economic slowdown and inflation complicating global market competitiveness.