By passing up the Trans-Pacific Partnership (TPP), Philippine industries may lose a significant share of the US market.
“We cannot afford not to be part of that agreement [TPP] because the United States is one of our largest markets. Our neighbors, Brunei Darussalam, Malaysia, Singapore, and Vietnam, are part of that agreement. If we are not part of this agreement. Our neighbors will get preferential tariffs and larger market access. In effect, this may diminish our market access,” Trade Undersecretary Adrian S. Cristobal Jr. said.
Among the sectors that may be significantly affected are the electronics and agriculture industries. The Philippines’ top 5 exports to the United States are static converters, ignition wiring sets, electrical machinery, other digital monolithic integrated circuits and coconut (copra) oil.
According to Cristobal, the Philippines hopes to be part of the TPP if and when the US opens up a second round. At present, the government continues to prepare for the pact by conducting various technical consultations and impact studies.
A number of industries meanwhile are expected to greatly benefit from the TPP, should the Philippines succeed in becoming part of the trade agreement, Cristobal added.
Those that stand to gain are the manufacturers of processed food, electronics, garments, oils and furniture.
The TPP is a multilateral agreement being negotiated among the United States, Australia, Brunei Darussalam, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, and Vietnam. The agreement will result in lower trade barriers among participating countries. The regional pact also aims to strengthen patent protection in the countries concerned.
The Philippines first expressed its interest to be part of the TPP in mid-2010.
Earlier this month, the US Trade representative said in a statement that the countries concerned “are on track to complete the Trans-Pacific Partnership negotiations.”
The final Trans-Pacific Partnership agreement “must reflect our common vision to establish a comprehensive … model for addressing new and traditional trade and investment issues, supporting the creation and retention of jobs and promoting economic development in our countries,” the US trade official added.