Phl hopes for GSP reauthorization, FTA with US

The Philippines continues to hope for a free trade agreement (FTA) with the United States, as well as the reauthorization of the Generalized System of Preferences (GSP) program, according to Trade Secretary Alfredo Pascual.

Pascual recently met with members of the US-Asia Pacific Economic Cooperation (APEC) in Bangkok, Thailand, where the Philippines’ priorities and programs to encourage more foreign investments and boost economic growth were discussed.

He said the US remains among the top trade partners of the Philippines even during the pandemic, stressing that in 2021, the US was the country’s top export market and our fifth largest import market.

“The strong trade relationship between the Philippines and the US is a product of the robust trade mechanisms in place that facilitate liberalized rules leading to enhanced preferential market access, which include the GSP,” Pascual said.

The Trade Secretary said the Philippines has consistently been a top beneficiary of the GSP and a top supplier of affordable imports for American manufacturers and consumers.

“The high utilization demonstrates that there are substantial savings by US importers in sourcing products from the Philippines. This also indicates a growing awareness and demand for GSP-listed Philippine exports by US manufacturers and consumers,” Pascual said.

We are looking forward to the GSP’s immediate reauthorization to spur tangible benefits, including investments and job creation, and skills development for our workers. We continue to fulfill our commitments to all GSP statutes, including respecting workers’ rights and protecting US intellectual property,” he added.

Apart from the renewal of the GSP, which expired on Dec. 31, 2020, Pascual also expressed hope for a FTA with the US.

“We continue to look forward to a FTA with the US, which will serve as a more permanent mechanism to lock in market access interests and other binding commitments to expand bilateral trade and investment,” Pascual said.

We hope to build on the momentum of our previous dialogues on agriculture and intellectual property in moving towards possible FTA negotiations,” he added.

During the meeting, Pascual highlighted the major economic reforms that the Philippines introduced to create a more conducive and transparent business environment, including the passage of the CREATE Act, the amendments to Foreign Investment Act, Retail Trade Liberalization Act, and Public Service Act , and the approval of the 2022 Strategic Investment Priority Plan.

Supporting industry development initiatives, he said that the Philippines is working to eliminate tariffs on electric vehicles and the liberalization of the current investment regimes on solar, wind, and tidal energy.

In the meeting, Pascual also talked about the Philippines’ participation in the Indo-Pacific Economic Framework (IPEF).

“On the IPEF, we are looking forward to joining the first negotiating meeting this December in Brisbane. We see it as a mechanism that will provide opportunities to cooperate on trade and investment. We are keen to tap into grants, support or procurement opportunities to complement industry development initiatives of the Philippines,” Pascual said.

He said that in the IPEF meetings, the Philippines strongly supported provisions on building supply chain integration and strengthening crisis response.

“Mitigation of disruptions and vulnerabilities is a critical concern, especially the mobilization of investments and cooperation to ensure reliability in the supply of goods and related services. We also continue to seek sustainable investments from US and global companies, especially those that will strengthen the country’s position within the largest global value chains of critical sectors, such as semiconductors,” Pascual said.

“Further, through the Working Group on Economics, Development and Prosperity under the Philippines-US Bilateral Strategic Dialogue, we are also seeking cooperation on green metals to address the supply of critical minerals,” he added.

Moreover, the Trade Secretary said that the Philippines is keen to tap into grants, support, or procurement opportunities to complement the country’s industry development initiatives.