The tariff rate on the exports of Philippine fresh bananas to South Korea has been slashed to 18% from 30% following the effectivity on Dec. 31, 2024 of the bilateral free trade agreement (FTA) between the two countries.
Trade and Industry Secretary Cristina A. Roque cited the Philippines-South Korea FTA as a crucial development for the Philippine banana industry. “This agreement is expected to create new opportunities for businesses and consumers, while fostering strong and resilient supply chains,” she said.
Under the agreement, tariff on the export of Philippine fresh bananas is now at 18%. This will be brought down over a five year period until it reaches zero tariff by January 2028.
The FTA allows Filipino banana growers to become more competitive stance versus competitors from other countries, some of which already enjoy zero tariff.
In 2023, South Korea ranked 5th among the Philippines’ 230 trade partners, 5th out of 205 export markets, and 4th out of 221 import suppliers. Bilateral trade between the two countries amounted to $12 billion. In the same year, South Korea also ranked 7th in terms of net foreign direct investment, with $21.3 million, and 12th in terms of approved investments with $27.3 million.
The FTA with South Korea is the Philippines’ third free trade agreement, following the Philippines-Japan Economic Partnership Agreement signed in September 2006 and entered into force in December 2008, and the Philippines-European Free Trade Area FTA signed in April 2016 and entered into force in June 2018.
