PH expects to wrap-up talks on bilateral FTA with Korea by first quarter

The Philippine government expects to finalize and wrap-up bilateral discussions on the proposed free trade agreement with South Korea by the first quarter of 2021, according to an official of the Department of Trade and Industry.

DTI assistant secretary Alan Gepty said the discussions were in the last stage, with only two issues remaining to be threshed out.

“We need to finalize the remaining chapter on economic and technical cooperation. This can be easily resolved, just a matter of fine-tuning the provisions, nomenclature, and preferences. The challenge for us is the market access issue,” he said.

He said the Philippines had “yet to receive a reasonable offer from Korea.” Korea has yet to agree to several concessions, including the Filipino exporters’ access to the Korean fresh fruit market.

The Philippines has been fighting for the entry of Philippine mangoes and pineapples to South Korea for more than a decade.

Philippine bananas were granted market access with 30-percent duties which Filipino banana exporters found stifling, compared to bananas from South America which had relatively lower duties, some even at duty-free.

The Philippine banana industry seeks to reduce the tariff on bananas to 5 percent from 30 percent to compete with other banana exports to the Korean market.

Philippine Cavendish exports to South Korea have steadily decreased since 2013. Korea, meanwhile, was asking for lower duties for industrial exports to the Philippines that include automotive parts. Korean auto parts exports to the Philippines carry 30-percent duties.

Gepty said that while the Philippines is part of the ASEAN-Korea FTA and the newly-formed Regional Cooperation and Economic Partnership, “we still need to push products not covered by these agreements.”

“We fervently hope that Korea will agree to our request, so we can capture a bigger trade value. For our bananas to Korea, discussions for lower tariff continue to be fluid. Unless and until they give us acceptable offers, it will be difficult to reach a convergence,” he said.