MANILA (UPDATED) - The Philippines is eyeing a free trade deal with the United States while waiting for the renewal of its eligibility to the US GSP (Generalized System of Preferences) program which expired in 2020, a trade official said on Tuesday.
The GSP is a trade program that provides duty-free importation of select goods from eligible developing countries.
DTI Director of Bureau of International Trade Relations Angelo Salvador Benedictos said the Philippines is waiting for the decision of the US Congress regarding the GSP grant.
"We're waiting for what's happening in the US Congress and we'd like to renew the GSP benefit," Benedictos said during the launch of the US-Philippines Economic Impact Study by the Ateneo School of Government.
But Benedictos said a free trade agreement (FTA) is also preferred.
"We'd like to have an FTA with the US. We believe this is a more permanent mechanism compared to GSP. When both sides are ready probably this will happen," he said.
He said the US is the Philippines' 5th largest source of investment in 2022 amounting to P5.06 billion.
The friendlier relations between the two countries under President Ferdinand Marcos Jr.'s administration have increased the interest of foreign investors in the Philippines, Philippine Ambassador to the US Jose Manuel Romualdez earlier said.
In January 2023, the US was among the top 3 sources of foreign direct investments. The US was also the Philippines' top source of cash remittances in January 2023.
The US must also offer trade concessions since the Philippines' particiation in the Regional Comprehensive Econmic Partnership (RCEP) "will be a gravitational pull towards China," said Foundation for Economic Freedom President Calixto Chikiamco.
"The US must offer trade concessions under the Indo-Pacific Economic Framework not just standards that must be met. I believe we should forge stronger ties to the US because we have shared values and the US is still a leading super power in the world and a treaty ally," he said.
US Embassy in the Philippines Senior Commercial Officer Paul Taylor said President Joe Biden's Indo-Pacific Economic Framework aims to deepen the US' economic relations in the region.
"The Philippines is a very strategic and important part of that relationship," Taylor said.
Chikiamco said he believes in a strong US Philippine economic relationship but the US should find ways to compensate for the "talent drain" in the country since many healthcare professionals are moving to the west for higher pay.
In a visit to the New York Stock Exchange in September 2022 during a ceremonial bell ringing, Marcos committed to nurturing its trade and business relationship with the United States.
"The United States and the Philippines have long enduring ties in trade and commerce, among many other areas of cooperation...As the Philippines transforms into one of the most promising emerging markets, the United States has been among our steady partners, for that we are truly grateful," he said.
"I wish to emphasize that the Philippines is keen to continue nurturing the ties that help produce mutual benefits for both our economies, our organization and our people. Let us achieve many more milestones together," he added.