Phl-Korea FTA and US tariffs

In the first month of the year, our country is already facing two trade issues that will greatly impact our economy.

- MARIANNE GO

The first trade issue is the effectivity of the Philippines-Korea Free Trade Agreement (FTA) last Dec. 31, 2024, which is supposed to enhance market access for Philippine products, such as bananas and pineapples, to the Korean market.

The second is the tariff threat made by US president-elect Donald Trump on some of its trade partners, particularly China, Canada and Mexico. Although the Philippines is not a target of the US tariff threat, there are fears that it could have some negative ripple effect on Asia because of China.

On a more positive note, our long friendly relation with the US could once again improve our preferential tariff arrangements.

On the other hand, the Phl-Korea FTA is supposed to unlock significant opportunities for both countries and foster deeper trade and investment ties across key sectors such as industry, agriculture, infrastructure and energy, according to the Korean embassy.

The Phl-Korea FTA encompasses a comprehensive array of provisions, covering areas such as the trade in goods, trade remedies, rules of origin, customs procedures, trade facilitation, economic and technical cooperation, competition and legal and institutional matters.

In terms of the Philippines' priorities within the FTA, the country focused on enhancing market access for key products such as bananas, processed pineapples, various fruits, industrial goods and a diverse range of services.

For Philippine bananas, tariffs shall decrease by six percent by the end of the year and an additional six percent at the start of this year, giving the commodity greater market access in South Korea, according to the Department of Trade and Industry (DTI).