The Philippines is looking at forging bilateral trade relations with countries in Latin America, according to the Department of Trade and Industry (DTI).
Trade Secretary Alfredo E. Pascual told reporters that the country should start looking at Latin American countries like Argentina, Brazil, Chile and Mexico.
“We should start looking at Latin America like Argentina, of course the bigger ones Brazil and Chile. And Mexico,” the Trade chief said.
“Those are the ones that we can open. They will open their market to us and our market to them. If our exports are complimentary, that would be a good match,” Pascual added.
For Chile, Trade Undersecretary Ceferino S. Rodolfo said the Philippines has already inked a memorandum of understanding (MOU) with Santiago for the establishment of a joint economic cooperation (JEC). In addition, Rodolfo said, there’s also a “discussion to explore” with the country.
“The signing of the MOU is a significant milestone for both economies as it represents the first trade and investment mechanism of the Philippines to formally engage the South American Region,” the DTI said in April 2021.
Rodolfo said in his remarks during the virtual signing of the JEC that it will serve as a “confidence-building measure to further intensify the bilateral economic linkages while addressing the challenges posed by geographic distance and generally low-level of awareness by businesses in each other’s markets.”
Currently, the Philippines has free trade agreements (FTAs) with Japan and the European Free Trade Association (EFTA).
According to DTI, the Philippines-Japan Economic Partnership Agreement (PJEPA) is the first bilateral trade agreement of the Philippines. It was signed on September 9,2006, by former President Gloria Macapagal-Arroyo and former Prime Minister Junichiro Koizumi. The Senate concurred with the ratification of the PJEPA on October 8,2008 and the FTA officially entered into force on December 11, 2008.
Meanwhile, the EFTA—composed of Iceland, Liechtenstein, Norway and Switzerland—and the Philippines signed the trade agreement on April 28, 2016 in Bern, Switzerland.
The DTI said the agreement entered into force on June 1, 2018 for the Philippines, Norway, Lichtenstein and Switzerland. For Iceland, the FTA took effect on January 1, 2020.
According to the Trade department, the EFTA provides the Philippines duty-free market access for all industrial and fisheries tariff lines upon entry into force of the FTA.
The Philippines also secured tariff concessions on “substantially” all Philippine agriculture exports to EFTA such as frozen tuna and mackerel, canned pineapple, crude coconut oil and bananas.
The Trade chief also said that once the Senate ratifies the country’s membership to the Regional Comprehensive Economic Partnership (RCEP), there will be a “big improvement” in the country’s trade relations with the ASEAN countries along with Australia, New Zealand, Japan, Korea, and China.
Pascual said joining FTAs will help diversify the country’s exports in terms of products and services and country destinations and enhance the country’s attractiveness to foreign investments.
With only 10 free trade agreements (FTA), the Trade chief said the Philippines has the least number of FTAs among the six Asean countries. Pascual explained, “Singapore signed 27 FTAs, Malaysia 17, Thailand 15, Indonesia 15, and Vietnam 15.”
The Trade department also hopes to sign the Philippines’s FTA with Korea in the first quarter of 2023.