By means of Justine Irish D. Tabile, Reporter
The Philippines must follow a sectoral agreement with the United States with a focus on critical minerals, even if it hopes to forge a free trade agreement (FTA) under the government of President Donald J. Trump.
“We have a good chance of being able to draw that (free trade agreement), but I think it should be sectoral. It cannot be the entire free trade agreement, “said Jose Manuel D. Romualdez, Filipino ambassador in the US, at the press conference of the US-Philippines Society on Tuesday.
“During the first Trump administration we had some discussions about how we continue with the free trade agreement, but that was clearly abbreviated, and so we now have the chance to renew that,” he added.
Mr. Romualaldez said that the idea was driven during his conversations with former American trade secretary Wilbur L. Ross, Jr.
“His advice to me was that we pursue a sectoral type of FTA, such as in minerals that we can offer the US, and then on the aspect of other areas where we can also be useful, such as semiconductors,” he said.
“While the US trying to bring all of that back to the US, we are one of the seven countries that have been identified as trusted allies of the US. So we can be a recipient of a part of that semiconductor industry that is moved from China, “he added.
When asked why critical minerals should be a priority, Mr. Romualaldez said that this is an area where the Philippines and the US can benefit mutually.
“It is one of our natural resources and part of our wealth. And for example, we could get better prices for Nickel if we could handle it here, “he said.
More than 90% of Filipino nickel export goes to China, Mr Romualaldez said.
“They get the whole thing, and they even dictate prizes. So we want to change that. We followed the critical mineral agreement with the US, even during the Biden administration, and this time we will pursue it even more more powerfully, “he added.
Earlier this year, the Filipino Department of Trade and Industry said that the country would double the efforts to secure a free trade agreement with the US.
“The Philippines need the free trade agreement with the US, and it is equally important that the partners in the region, such as Japan and South Korea, need us to have a free trade agreement with the US,” said trading secretary Ceferino S. Rodolfo .
“This is so that they can protect a non-China-Supply Chain for certain critical industries, including our minerals for batteries,” he added.
The Philippines is the largest exporter of the concentrate of Nikkelerts, good for more than a fourth of the worldwide offer. Of the total nickel concentrate export of the country, more than 98% goes to China, while 1% goes to Japan.
Rene D. Almendras, a member of the US-Philippines Society, said that the Philippines must insist on a sectoral agreement that focuses on critical minerals, because this benefits provincial areas.
“A revitalized mining industry will benefit national and provincial areas that have been neglected in the past. So if we can revive that industry, the benefits will be very, very good in the areas where we need it the most, “he said.
“The geographical location of those mines and hopefully those processing facilities will stimulate development in those areas where it is desperately needed. And the Marcos government is doing very well to decentralize the economy, “he added.
However, Mr Almendras said that the Philippines should first tackle the concern of potential investors about the power supply.
Apart from a sectoral FTA, Mr. Romualaldez said that there is a good chance that the American General Preference System (GSP) would be re -authorized by the American Congress.
‘[There is] A very good chance, actually. There are so many other countries that work to get that juice … in the US Congress, while they all agree that the juice must be given to the Philippines, there are some issues that every senator or congress would want Insert if they would like to or they would like a negotiating ship, “he said.
“But we are convinced that we can pass it on within this coming congress.”
The Philippines were a beneficiary of the American juice, who eliminated the tasks at around 5,000 or 47% of the total American tariff lines.
The suitability of the Philippines for the American GSP benefits, however, decreased on December 31, 2020, which meant that the Filipino export to the US that was previously mandatory under the preferential diagram, are now subject to the most guided rates.
Although active, the Philippines were the fourth largest beneficiary of the American GSP by around $ 1.6 billion in tax-free exports in 2020. This was 10% of the total American GSP input, which was $ 16 billion.
Earlier this month, the Philippine Exporters Confederation lobbyed, Inc. For the re-authorization of the American GSP and said that it could increase exports, especially of hard goods, by 5-10% this year.