The Philippines and South Korea concluded negotiations for a free trade agreement seen to help contribute to the two Asian nations’ economic recovery efforts
Philippine Trade Secretary Ramon Lopez and Korea Trade Minister Yeo Han-Koo on October 26 announced the conclusion of negotiations after the two countries finally resolved outstanding issues
Negotiations for the Philippines-Korea FTA started on June 3, 2019
Legal scrubbing of chapter texts on the FTA has begun
The Philippines and South Korea have concluded negotiations for a free trade agreement (FTA) seen to help contribute to the two Asian nations’ economic recovery efforts.
Philippine Trade Secretary Ramon Lopez and Korean Trade Minister Yeo Han-Koo on October 26 announced the development after the two countries finally resolved outstanding issues. “We are glad that our trade negotiations with South Korea have come to a fruition. We also thank Minister Yeo and the Ministry of Trade, Industry and Energy (MOTIE) for their continued collaboration in facilitating a wider economic cooperation with our Philippine trade department,” Lopez said in a statement.
Negotiations for the Philippines-Korea FTA started on June 3, 2019. In November 2019, both countries signed the Early Achievement Package that confirmed the agreement of both sides to lock in the list of products already offered by both sides at the time. Taking off from the achievement package, the two countries resolved outstanding issues that led to the conclusion of negotiations.
The legal scrubbing of chapter texts on the FTA has commenced, namely on the issues of Trade in Goods, Trade Remedies, Customs Procedures and Trade Facilitation, Rules of Origin, Competition, and Chapters under Legal and Institutional Issues (i.e., General Provisions, Transparency, Institutional Arrangements, Final Provisions, Exceptions, and Dispute Settlement).
The Trade in Services and Investment chapters will be covered in future negotiations. The Trade in Goods and Economic and Technical Cooperation chapters are set to be finalized by both sides with a view to ensure closer collaboration towards a robust post-pandemic recovery.
The final negotiations focused on market access for Philippine banana exports and for Korean automotive units and parts. The Philippines secured tariff elimination for bananas, which was previously excluded under the Association of South East Asian Nations (ASEAN)-Korea FTA. Likewise, the discussions allowed for an improved tariff treatment for processed pineapples, as compared to the Regional Comprehensive Economic Partnership (RCEP) concessions.
According to Lopez, with the RCEP agreement complemented by the bilateral agreement, the trade value of Philippine exports to South Korea will now be substantially covered, making Philippine exports competitive in the Korean market.
Once enforced, the FTA with South Korea is seen as an important vehicle for enhancing trade flows and generating more investment and employment opportunities between the two nations.