go through Chloe Mari A. Hufana, Reporter and Luisa Maria Jacinta C. Jocson, Senior Reporter
U.S. President Donald J. Trump announced Tuesday that he will impose a new 19% tariff on goods From the Philippines, follow Meet with President Ferdinand Marcos Jr. in the White House.
“It’s a wonderful visit and we concluded that the Philippines is opening up markets with the United States with zero tariffs. The Philippines will pay 19% tariffs,” Mr. Trump said on his Truth Social Platform.
Although the new tariff rate is slightly below the threatened 20%, the 19% rate is higher than the 17% “reciprocal tariff” announced by Trump in April.
“one [percentage point] It seems to be a small concession. But when you really say that, it’s a big achievement. “Mr. Marcos said in Washington after meeting with Trump in the Oval Office.
“They told us that it was because of the special relationship between the Philippines and the United States.”
Contrary to Mr. Trump’s social media post, Mr. Marcos clarified that the Philippines will only open the market for U.S. cars.
“He (Mr. Trump) is talking about cars. Because we have taxes on American cars, we will open the market and no longer impose tariffs on it,” he said.
As part of the deal, Mr Marcos said the Philippines will also increase imports of U.S. soy and wheat products as well as medicine.
“There is still a lot of details to be identified on different products,” he said.
A Reuters report quoted the Philippines’ ambassador to the United States, Jose Manuel Romualdez, saying it was “a growing deal for both countries, and over time it has been growing.”
Mr Trump said the “very big numbers” in the trade agreement will only grow.
According to data from the U.S. Trade Representative, U.S. trade in goods with the Philippines is about $23.5 billion in 2024. U.S. goods exports were $9.3 billion, while imports from the Philippines totaled $14.2 billion, totaling $14.2 billion, bringing the U.S. goods trade deficit to nearly $5 billion compared with the Philippines’ trade deficit, to 21.8% by 2023.
The United States is the highest export destination for Philippine goods, accounting for about 16% of the total export volume of semiconductors and electronic products between January and May.
Still the lowest
Meanwhile, the Ministry of Economics, Planning and Development (DEPDEV) said the new 19% tariffs have put the Philippines in Good location compared to Southeast Asian neighbors.
“But if you look at the entire association of Southeast Asian countries (ASEAN), we are second in Singapore. For me, that’s still a good result.”
Mr Balisacan said the potential impact of the 19% and the previous 20% tariffs was “not much”.
“We are more concerned about indirection. Indirect is how tariffs in other countries look compared to us. This is more important because of the potential trade transfer benefits.”
The Philippines’ new U.S. tariff rate is now the same as Indonesia, slightly below 20% of Vietnam. Singapore faces a minimum U.S. tariff rate of 10%.
Although Vietnam can obtain a 20% tariff, the tax rate for any currency goods will reach 40%.
“How many are actually imported from China indirectly through Vietnam? This will be affected by the high tariffs,” he said.
Asked about zero tariffs on U.S. auto imports, Mr. Balisakan said that was not a reason for concern.
“When you look at the current account deficit, you don’t look at it by country. You should look at the total, which is important,” Mr Balisacan said.
“As a country, you should be able to accept the deficit of a country that can import cheaper products than other countries. Then you can export your productsUCT to a place where you can direct higher value. ”
Mr Bariscan said the Philippines will rely heavily on domestic demand in the context of these trade uncertainties.
“That’s what you can count on. It’s really what saves our economy because of all this uncertainty in the global economy. It’s domestic,” he said.
“We have to strengthen, even if we are preparing for a good trade in the global economy. Nevertheless, we still need to continue reforms to be more competitive. Unlike the past few decades, despite the improvement in the global economy, we are not ready. So we missed the ship. There is still a lot to do.”
Ibon Foundation executive director Jose Enrique A. Africa said the new trade deal is extremely beneficial to the United States.
“It’s a bad deal, President Marcos Jr. comes home empty-handed. The Philippines has few benefits, only fees,” he said in a Viber chat.
He added that zero tariffs on U.S. cars, in particular, could lead to lost revenue, trigger trade tensions with other auto exporters such as Japan, South Korea, China and the EU, and hinder any plans to develop the domestic auto industry.
Economists also point out that the public must understand the full scope of the concessions the Philippines has made, especially in terms of economy and defense.
