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The Department of Trade and Industry (DTI) will continue building on free trade agreements (FTAs) and a generalized system of preferences (GSP) to expand export markets, as the country increases its production capacities to meet domestic and foreign demand.
In a webinar, Trade Secretary Ramon Lopez said Philippine products will be sold with zero duty in other countries under FTAs, and in the United States and European Union market under GSP.
“What is good about these, it can encourage foreign investors to locate in the Philippines because when they manufacture here, they can benefit in exporting [these goods at] zero duty to other countries,” he said in Filipino.
The DTI chief said the country is still working on FTAs with South Korea, and is talking to India and Canada. “Hopefully, we can enhance further economic cooperation with India to go into a bilateral trade arrangement,” he said. “We have right now an FTA with Japan as well as EFTA [European Free Trade Association] countries.” EFTA member- states are Iceland, Liechtenstein, Norway and Switzerland.
Under Asean, the Philippines has preferential trade agreements with China, India, Japan, South Korea, Australia and New Zealand.
“And [we] will continue [to strengthen]…trade promotion to promote our products and deepen integration in global value chains,” he added.
Lopez cited as examples electronic products wherein all countries in the region are part of the value chain.
“They are developing stage by stage when it comes to electronics. So all are trying to improve their portion to increase the value of the respective parts so we are also doing the same,” he said.
“Right now, even in aerospace parts, we are doing it in Batangas, we are doing more of the designs now, meaning higher value in aerospace parts. Very technical and very high tech.”
On the supply side, the DTI chief said the country is working to empower production capacities to capture demand.
“Because it is difficult to sell and sell outside the country, then we have no capacity here. So it is very important that we really create our manufacturing capacity here, encourage more manufacturers to build their capacities here so that we have the capacity when there is a demand for our exports,” he added.
To boost production capacities, Lopez said strategies include accelerating investment in sectors/areas that provide for basic necessities, support 4th Industrial Revolution and generate high value/job creation; intensifying implementation and widening coverage of supplier development programs; encouraging digital transformation; supporting businesses to provide necessities in the new normal; and promoting Philippine high-value exports of products and services.