The Philippines will be able to enjoy preferential tariffs on key exports to the United States until 2020 just in time before the two countries are expected to formally launch negotiations for a free trade agreement (FTA).
Ramon Lopez, secretary of the Department .of Trade and Industry said the Philippines and the US are progressing on their consultations on the proposed FTA but that it could take three to five years, or before the end of the administration that a deal can actually be reached.
According to Lopez, the objective is for the Philippines to “at least level the field with respect to Asean and China” and for the US to use the Philippines as hub for Asean and Asia in a scenario where neither are part of the Trans Pacific Partnership.
Lopez said a bill in US Congress extending the Generalized System of Preferences (GSP) for three years is awaiting approval. The scheme expired in 2017 and usually needs annual renewal in a rider bill.
The three-year renewal has been passed by the US House of Representatives and is pending at the Senate. If passed, the effectivity of the three-year renewal is retroactive to January of this year.
Lopez said the Philippines which is seeking the inclusion of footwear in the US GSP will also apply for the addition of garments in the scheme.
“We will push garments. It’s one of those low-hanging fruits,” he said, adding the sector, one of 12 being promoted by the DTI due to the country’s competitive advantage, has a huge potential especially that the US currently sources a lot of its garments from least developed countries.
In the past, Philippine garments have become dependent on the US market under a quota regime.
According to Lopez, the three-year GSP assures the Philippines of continuity for exporters “and won’t break the momentum.”
Source: Malaya
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<p>Time: November 2025<br /> By: WTO and International Trade Group, Legal Department – VCCI</p>
