More PH products get zero duty treatment from Japan

Starting this year, the Philippines will be enjoying zero duties for more products that are being exported to Japan.

This development is seen to further expand and deepen the economic partnership between the Philippines and Japan, according to the Department of Trade and Industry.

The continued reduction in tariffs is provided under the Philippine Japan Economic Partnership Agreement (Pjepa), the only bilateral deal that the country has signed so far.

“Immediately upon [Pjepa’s] entry into force in 2008, 80 percent of Philippine exports to Japan, consisting of 7,476 products, became eligible for zero tariff. Starting this year, the Philippines will be enjoying zero duties for 7,839 tariff lines or about 84 percent of Japan’s tariff lines,” said Senen M. Perlada, director of the Export Marketing Bureau at the DTI.

“These products include garments and textiles, furniture, food products, minerals, metal manufactures, machinery and equipment parts, electronics, chemicals and motor vehicle parts,” Perlada said in an interview with the Inquirer.

Among the products that are currently benefiting from the zero tariff under the Pjepa are yellow fin tuna which enjoys the most favored nation rate of 3.5 percent but is currently zero under the bilateral deal; fresh mangoes (MFN of 3 percent); refined coconut oil, crude coconut oil; shrimp and prawns; smoked fish; builders’ woodwork, and other plywood and veneered panels.

Dried pineapples are slapped with a 3.3-percent tariff under Pjepa, lower than the MFN rate of 7.2 percent.

Although the country already enjoys favorable concessions, there remained room for inclusions. The trade official, for instance, noted that the appeal made by the Philippine Banana Growers and Exporters Association Inc. (PBGEA) which sought the elimination of Japan’s import duty on fresh bananas.

Citing the estimates of PBGEA, Perlada said the elimination of tariffs might increase the demand for Philippine bananas by 20 percent, which would trigger development of additional 3,750 hectares of banana plantation, P4.5 billion in new investments, P3.7 billion in additional annual export revenue and creation of 22,500 new jobs.

For the first general review of Pjepa, the Philippines is expected to seek zero duties on and the scrapping of quotas for certain agricultural products such as bananas and pineapples.

Trade Undersecretary Ceferino S. Rodolfo said in an earlier interview that the trade department’s focus was more on increased access for agricultural products, as the Philippines had already breached the quotas set under the bilateral deal.

Rodolfo earlier explained that under the Pjepa, some of the country’s agricultural exports to Japan were already enjoying preferential rates. However, since the demand for local produce has seen significant increases over the past years, the export volumes have risen and are already starting to breach the prescribed quotas. Amy R. Remo