To navigate US tariffs, Phl must diversify markets

As higher tariffs loom for Philippine goods entering the US, calls to diversify the country's export markets and reimagine how it competes on the global stage are becoming more urgent.

- By Louella Desiderio

US President Donald Trump's sweeping tariffs are causing uncertainty globally and businesses are anxiously waiting for what will happen next.

For the Philippines, the US tariffs are not just a disruption. It's a wake-up call to step up and renew its exports push.

Following his meeting with President Marcos, Trump announced on July 22 that a 19 percent tariff will be imposed on Philippine goods entering the US.

As part of the deal with the US, the Philippines will be removing the tariff on American automobiles and increasing its imports of US soy products, wheat and pharmaceuticals.

Special Assistant to the President for Investment and Economic Affairs Frederick Go and Trade Secretary Cristina Roque, who were part of the delegation to negotiate to bring down the tariff, said the negotiators still have to work on details to finalize the agreement.

The new tariff rate for Philippine exports to the US is lower than the earlier announced 20 percent but higher than the 17 percent reciprocal tariff proposed back in April.

The 17 percent tariff is the second lowest in Southeast Asia, next to Singapore's 10 percent.

At present, a baseline 10 percent tariff is being applied on exports to the US, including those from the Philippines, while the negotiations are being conducted.

With the 19 percent tariff, the Philippines still has the second lowest rate in the region after Singapore.

Former tariff commissioner George Manzano said the new levies announced by the US show that the Philippines' advantage over its neighbors may not last.

A trade deal between the US and Indonesia has led to the lowering of the 32 percent tariff on the latter's exports to 19 percent.

As part of the agreement, Indonesia has committed to purchasing 50 Boeing jets, $15 billion in US energy supplies and $4.5 billion worth of agricultural products.