A BILATERAL free trade agreement (FTA) between the Philippines and the United States (US) government was not on the negotiating table as the Biden administration was more focused on its Indo-Pacific Economic Framework (IPEF) initiative, US Trade Representative Ambassador Katherine Tai said.
“In terms of a more ‘traditional’ FTA, we’re not currently negotiating any such agreements with trading partners in particular because we do not see that traditional [FTA] being appropriate for the types of challenges and opportunities that we’re facing right now,” Tai told members of the Philippine media in a briefing in Makati City on Tuesday, April 18.
The US Trade chief was asked if an FTA between the two allied nations was in the works.
Tai, the Biden administration’s principal trade advisor, explained that a “traditional” FTA was more focused to maximize liberalization, which she said created “vulnerabilities” in supply chains.
“That’s an important reason why we’re not doing traditional FTA, because we feel like if you continue to do things the same way, then why would you expect to have different outcomes… The different outcomes we are looking for are to have supply chains that are more resilient —trade patterns that are more sustainable and more inclusive,” she said.
“Our goals are not just to liberalize trade for the sake of liberalizing trade… The Indo-Pacific Economic Framework is designed exactly to do that… We’re not just trying to liberalize because that’s led to very fragile supply chains. We’re trying to figure out trade tools that we can use to serve the larger purpose of promoting resilience, sustainability, and inclusiveness,” she added.
The IPEF, launched in May 2022, is an economic initiative of US President Joe Biden with the US’ 13 trading partners —Australia, Brunei Darussalam, Fiji India, Indonesia, Japan, the Republic of Korea, Malaysia, New Zealand, Philippines, Singapore, Thailand, and Vietnam.
The 14 countries making up the IPEF represent 40 percent of the global economy and 28 percent of global goods and services trade, according to the Office of the US Trade Representative.
The US Trade chief met with Philippine Trade secretary Alfredo Pascual for the upcoming negotiating round of the IPEF.
The US is the Philippines’ third largest trading partner with over $18.9 billion in goods and services exchanged in 2020, according to the US State Department.
Key exports from the Philippines to the US include semiconductor devices and computer peripherals, automobile parts, electric machinery, textiles and garments, wheat and animal feeds, coconut oil, and information technology/business process outsourcing services. (GMA Integrated News)
