PH must pursue trade leverage, strategic diplomacy with US

President Donald Trump’s decision to raise tariffs on selected Philippine exports to the United States—from 17 percent to 20 percent —has important implications for the country’s manufacturing sector and trade competitiveness.

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While electronics and agricultural products are unaffected, the new tariff rate applies to a broad swath of labor-intensive goods including leather items, furniture, toys, sports equipment, and textiles. These industries contribute significantly to employment and rural development, and serve as entry points for small and medium enterprises into global value chains.

Although the tariff hike is relatively modest, it comes at a time of tight margins, rising production costs, and intensifying competition from regional neighbors. Most notably, the Philippines has now been placed on parity with Vietnam, which earlier negotiated a similar 20 percent rate on its exports to the U.S. This development reflects how Washington is leveling its trade posture across Southeast Asia amid broader strategic recalibrations. It also highlights the urgency for the Philippines to secure more differentiated access in future trade talks.