Foreign buyers of Philippine goods, particularly garments, are not optimistic of Philippines getting favorable response from the US on the increased 20 percent tariff rate imposed on all its exports to the U.S.
“The tariff negotiation will be uphill and challenging in the sense that it seems to have become a geopolitical issue,” said Robert Young, president of the Foreign Buyers Association of the Philippines (FOBAP).
Young said the Philippines will not be in a position now to offer something on the table in exchange with lowering the 20 percent tariff. “Unless we have concessions to offer again, like defense accommodation EDCA, VFA, etc. We’ve already given all these prior to reciprocal tariff issue,” he said.
“Unless Philippines can have some ‘bullets’ to offer in exchange with lower tariff, perhaps there will be a chance,” he added.
The Philippines is also a smaller player compared to other ASEAN neighbors, like Vietnam, that can offer something in return. Even pre-reciprocal tariff, Young said Vietnam was already quoting 15 to 20 percent lower prices in their garment exports than Philippines.
The 20 percent tariff, higher than the originally announced 17 percent in April, will definitely affect the country’s garment exports.
Young earlier said that export from the garments, textile and apparel sector this year could only hit USD800,000 from USD1 billion in 2024. In 2023, the country’s garment, textile, and apparel sector exported $1.2 billion.
