MANILA – Trade Secretary Cristina Roque is optimistic that the tariff on Philippine exports to the US would be further reduced, but noted that for now, the rate is at 19 percent, as announced by US President Donald Trump.
The rate is lower than the 20 percent announced a few weeks ago, but higher than the 17 percent announced in April.
In a media interview Friday, Roque said trade officials are finalizing with their US counterparts the details of the 19 percent tariff to be imposed on Philippine exports effective Aug. 1.
“For now, since it was already announced by President Trump, then it’s final. But of course, we’re really hoping we can bring it down,” she said.
While Philippine officials want the rate to be lower, Roque said they cannot make a demand, but she also noted that they are considering a free trade agreement down the line.
She explained that even though exports to the US will have a 19 percent tariff and US imports like medical equipment, automotive, and soya will have zero tariff, the Philippines need not offer anything in return to protect domestic industry sectors, such as agriculture.
Thus, agricultural products like rice and sugar are not included in the concession to protect the farmers.
In the case of Indonesia, it secured a 19 percent tariff for its exports to the US, down from the 32 percent announced earlier. However, it opened its entire market to the US.
“For us, we did not give the agriculture because it might hurt the farmers. It might hurt the agriculture industry,” Roque said.
“Kasi kung ibababa lang ng konting percent, it’s not commensurate to what we’re going to lose. So, that’s the reason for why sa kanila they gave all. Us, we did not (If the rate is reduced by only a little, it’s not commensurate to what we’re going to lose. So that’s the reason why the other countries gave it all. Us, we did not).”
The protection given to the agricultural and manufacturing sectors, among others, was hailed by Federation of Philippine Industries chair Elizabeth Lee, who called it “a strong step toward protecting our own industries.”
She said the zero percent tariff on materials not manufactured in the Philippines “if handled right, could help certain sectors lower costs without putting local producers at risk.”
“Conducting structured consultations with industry stakeholders, coupled with transparent disclosure of products covered by the agreement, can help mitigate potential adverse impacts. These measures may also support the timely activation of appropriate safeguard mechanisms for sectors at risk,” Roque said.
“At the end of the day, we all want growth, but it has to be balanced, fair, and locally anchored.” (PNA)