The Philippine electronics sector stands to significantly benefit from an agreement eliminating tariffs on 201 information technology products, as this accord will provide local firms access to over 90 percent of the global IT trade.
Trade Undersecretary Adrian S. Cristobal Jr. noted that the expansion of the World Trade Organization’s Information Technology Agreement (ITA) is seen to increase the access of local export products to markets such as the United States, Japan, European Union member-states, South Korea, and Chinese Taipei.
“Moreover, almost all imported raw materials and intermediate inputs and capital equipment requirements can be imported duty-free. Once the ITA expansion comes into force, it will provide the Philippines with access to over 90 percent of global IT trade. Furthermore, it will create jobs through increase in [foreign direct investments] and will help boost the [gross domestic product] growth for our country,” Cristobal explained.
It can be recalled that WTO members, including the Philippines, recently agreed to eliminate the tariffs for 201 IT products with trade value of over $1.3 trillion a year. This landmark agreement is expected to significantly benefit major IT product exporters like the Philippines, as it will support lower prices, create jobs, and help boost economic growth globally.
Among the products covered under this accord are the new generation semiconductors, static converters, video games, and parts of automated electronic component machines. The Philippines is a big part of these regional and global production chains.
“Philippine trade of these products in 2013 amounted to $26 billion, with exports reaching more than $14 billion,” Cristobal said.