The Department of Trade and Industry (DTI) said the Philippines would pursue free trade agreements (FTA) with Latin American countries as part of its overall efforts to develop trade relations with other nations.
Trade Secretary Alfred Pascual cited some of these Latin American countries, naming in particular Mexico, Brazil, Argentina and Chile as prospects.
“Those are the ones that will open their markets to us and our market to them. If our exports are complementary with theirs, it will be a good match,” Pascual said in a briefing.
The Philippines signed a memorandum of understanding (MOU) with Chile for a joint economic cooperation back in 2021 aimed at developing bilateral economic linkages between the Philippines and the South American country.
A possible bilateral free trade agreement between the two had also been discussed, according to Trade Undersecretary Ceferino Rodolfo.
“I think we will pursue that,” Pascual said.
Historical relations
The DTI chief said the Philippines had very strong trade relations with Mexico historically, referring to the Spanish galleon trade, which connected Asia with the North American country during the Spanish colonial period.
This latest push by the DTI to form a free trade agreement with Latin American countries is among the latest string of measures by the Marcos administration to strengthen the trade relations of the Philippines with other countries.
Earlier in November, the trade department said it was set to sign a free trade agreement with South Korea next year.
Local banana and processed pineapple exporters are seen benefiting from this move through a reduction or elimination of import tariffs.
The local electric vehicle sector and other allied industries are expected to benefit greatly under a Philippine-South Korea FTA, according to the trade department.
Top exports destination
Aside from the FTA with the East Asian country, the Philippines is also pursuing a similar trade deal with the United States to serve as a more permanent mechanism to improve the trade relations between the two countries.
The Philippines is currently waiting for a renewal under the US Generalized System of Preferences (GSP) scheme, which expired back in 2020. Under this, the Philippines was able to export products at lower tariffs compared to non-GSP countries, making them more affordable.
Philippine exports to the western country under the GSP totaled $1.732 billion in 2019, with the Philippines ranking fifth among GSP users after Thailand, Indonesia, Brazil and Cambodia.
Major GSP products include tires, bags, insulated electric conductors, sugar, non-alcoholic beverages and hair dryers. INQ