THE bilateral trade agreement between Manila and Washington remains up in the air as the latter recently transitioned to a new administration.
Jose Manuel G. Romualdez, Philippine Ambassador to the US, said during the event titled “PH-US at 75: Strengthening Ties through Sustainable Recovery” on Thursday that Manila is still awaiting the go-ahead from the US Department of Commerce on how both parties will proceed with the trade deal discussions.
“We are still waiting for word from the Department of Commerce of how will that go,” Romualdez said.
“If you are talking about the bilateral trade agreement that we were talking about last year, it hasn’t been moved since there is new administration now,” he added.
Joseph Biden Jr. took his oath of office as the 46th president of the US in January this year.
Manila has been seeking to strike a trade accord with Washington to lift tariffs on a number of export products, including clothing products.
To recall, the US Trade Representatives were not able to make time for the said trade negotiation in 2019 as the US Congress was occupied in tackling the US-Mexico-Canada Agreement. American Chamber of Commerce of the Philippines Executive Director Ebb Hinchliffe, at the time, said that free trade talks between the Philippines and US were likely to start by 2020.
“I cannot overemphasize the importance of cooperation and collaboration between and among our government and private sector at this time as we both work on addressing and mitigating the impact of the pandemic on our peoples and our economies,” Romualdez said.
Top trade partner
Meanwhile, US Embassy in the Philippines Charge d’Affaires John C. Law said that both countries have “close bilateral ties” through the years as proven by the growing business connections between Manila and Washington, marking 2021 as the 75th anniversary of partnership.
For example, the US diplomatic official noted that nearly 40 US companies operating in the integrated circuit industry account for about half of the Philippine exports.
“We are proud that many US companies, including those in the Fortune 500, have found their home in the Philippines and hope that more companies would look to us as they diversify and reconfigure their supply chains,” Romualdez said.
Both officials noted that the US has also been among the top sources of foreign direct investments and trading partners of the Philippines.
Law, meanwhile, identified Washington’s priority sectors under its Indo-Pacific strategy, which include energy, infrastructure, digital connectivity and cybersecurity.
“In close cooperation with the Philippine government and with our business partners, we are further strengthening the economic relationship and working to build back better from the Covid-19 pandemic,” he said.
Currently, the Philippines is still waiting as well for the renewal of its Generalized System of Preferences (GSP) perks granted by the US as it expired on December 31 last year. The US Congress has yet to pass a new bill for said trade privilege.
Under the GSP, the Philippines can export to the US at zero or reduced tariffs for a total of 5,057 products, or nearly half of the 10,600 US tariff lines.
The BusinessMirror reported earlier that the Philippines may lose $1.87-billion worth of shipments if its preferential trade incentives with the US will not be granted anew. (Related story: https://businessmirror.com.ph/2021/02/08/dti-pins-hopes-on-fresh-wider-us-phl-gsp-deal.)
According to the Philippine Statistics Authority, the country’s exports to Washington declined by 16.1 percent to $9.71 billion last year from $11.57 billion in 2019. Imports from the US, meanwhile, plunged by 17.8 percent year-on-year from $8.07 billion to $6.63 billion in 2020.
The Board of Investments and Philippine Economic Zone Authority approved P24.28 billion worth of investment pledges from the US last year, which is more than double the P11.51 billion greenlighted in 2019.