1 week Ago By Tatiana Maligro
window.rapplerAds.displayAd( "middle-1" );window.
rapplerAds.displayAd( "mobile-middle-1" );MANILA, Philippines – The Department of Trade and Industry (DTI) believes the reciprocal tariffs imposed by the United States on Philippine goods could be an opportunity to further deepen trade ties between the two countries.Trade Secretary Cristina Aldeguer-Roque’s statement comes after US President Donald Trump slapped a 17% tariff on Philippine goods as part of “reciprocal” duties he imposed on all countries on Wednesday, April 2.
In a statement on Friday, April 4, Roque said the DTI’s initial analysis showed that US tariffs will not impact the country as much as its Southeast Asian peers such as Vietnam and Indonesia. Trump slapped imports from these two countries with 46% and 32% of duties, respectively.Roque said she hoped to meet with her American counterpart, Commerce Secretary Howard Lutnick, soon to discuss boosting trade between the Philippines and the US.
“The Philippines aims to actively engage the US in a discussion to facilitate enhanced market access for its key export interests, such as automobiles, dairy products, frozen meat, and soybeans, within the framework of a bilateral free trade agreement. This will allow both sides to pursue mutually beneficial trade,” she said.Roque also noted that some products are exempted from the US’ reciprocal duties, which include copper ores and concentrates, as well as integrated circuits.
The US was the Philippines’ third-largest trading partner in 2024, according to data from the Philippine Statistics Authority (PSA).The US accounts for 17% of the Philippines’ exports in 2024, PSA data showed. Electronic products such as semiconductors comprise around 53% of these exports, equivalent to 10% of Manila’s trade with Washington.
Washington mostly imported electronic products, wiring sets, coconut oil, and machinery and transport equipment from Manila, while the Philippines imported electronic products, animal feeds and other agricultural products from the US.While Finance Secretary Ralph Recto acknowledged that the Philippines will be impacted by the US duties, he believes that the lower tariffs compared to other Southeast Asian countries will attract more investments to the country.“If the US has a 40% tariff on products from Vietnam, while the Philippines has 17%, it will make sense for investors to come to the Philippines, since the tariffs are smaller if the products sold to America are produced here,” he said in Filipino.
Agriculture Secretary Francisco Tiu Laurel Jr. earlier said the duties could make Philippine agricultural exports more competitive in the US market.window.
rapplerAds.displayAd( "middle-2" );window.rapplerAds.
displayAd( "mobile-middle-2" );Must Read Trump tariffs may be favorable to PH agri exporters – DA chief Slower GDP growth?While the reciprocal tariffs present the Philippines with an opportunity to tap new markets, economists believe the tariffs could dampen the country’s economic growth.According to Rizal Commercial Banking Corporation’s chief economist Michael Ricafort, the 17% duty on Philippine goods could make them less competitive in the US market.The tariffs may cause a slight drag on gross domestic product (GDP) growth not just in the Philippines, but in the global economy.
Ricafort also pointed out that it could slow export growth in the Philippines’ biggest export items to the US, which include the following:Electronic products ($6.4 billion)Ignition wiring sets ($755.4 million)Other manufactured goods ($692.
9 million)Coconut oil ($558.7 million)Machinery and transport equipment ($402 million)“Additional 17% tax could be passed to buyers or absorbed depending on competition,” he said.Bank of the Philippine Islands’ lead economist Jun Neri also believes the Philippines will not be hit as hard as its Southeast Asian neighbors, since domestic consumption comprises 75% of GDP.
However, he acknowledged that the tariff may slow down economic growth by half a percent.He also believes Philippine exports could contract to 4.2% from the originally projected 6.
1% growth since the US is Manila’s top export destination. The Philippines may also import slightly less to adjust to the sale of tangible goods abroad.Neri also said the tariffs may trigger volatility in the Philippine peso due to risk aversion and concerns over the performance of its exports.
A weaker peso means it will be more expensive to import goods, which could possibly hasten inflation.“This, in turn, may limit the Bangko Sentral ng Pilipinas’ ability to cut interest rates aggressively, as maintaining market stability could take priority,” he said. – Rappler.
com.
