The Philippine Exporters Confederation Inc. (Philexport) cautioned trade negotiators against making any offers at the expense of agriculture when they face their US counterparts at the negotiating table next week.
Philexport President Sergio Ortiz-Luis Jr., in a phone interview on Thursday, said the best offer the trade team could give is “to remind the US that the Philippines has been its best ally in the region.”
The Philexport head said the Philippines technically has nothing more to offer, especially on the geopolitical side.
“We cannot afford to offer agriculture. We no longer have any leverage. We have given the US the EDCA (Enhanced Defense Cooperation Agreement) sites, we buy military equipment and planes (from the US), we have proven ourselves to be a good partner,” he said.
Ortiz-Luis did not identify which products would suffer the most if the Philippines uses agriculture as a leverage, but said farmers are usually the first to take a hit.
The Philippines’ major imports from the US include soybeans, dairy, and frozen meat.
Instead, Ortiz-Luis added, the negotiators should focus on assisting exporters in areas such as R&D, product innovation, market diversification, and logistical support for export development.
He said that while the 3-percentage-point tariff increase is negligible, the ensuing 20 percent makes the Philippines comparable to Vietnam.
Vietnam is subject to a 20 percent tariff, except for products deemed transshipped, which are taxed at 40 percent.
“How can we compete? How do we know which products are transshipped?” Ortiz-Luis said.
US goods trade with the Philippines reached an estimated $23.5 billion in 2024, according to data from the Office of the United States Trade Representative.
US exports to the Philippines stood at $9.3 billion, a 0.4 percent increase from 2023, while imports from the Philippines totaled $14.2 billion, up 6.9 percent year-over-year.
The resulting US goods trade deficit with the Philippines widened to $4.9 billion in 2024, marking a 21.8 percent increase from the previous year.
