Recto: PH may lose P3B to P6B a year in US trade deal
The Philippines could forgo revenues of between P3 billion and P6 billion a year due to the zero-tariff concession granted to select US goods, according to Finance Secretary Ralph Recto.
Speaking to reporters on the sidelines of the 2025 post-State of the Nation Address (Sona) discussions on Tuesday, Recto maintained, however, that the recent trade agreement with Washington did not put Manila at a disadvantage.
Recto said that based on early estimates the government stands to lose “something like P3 billion to P6 billion” per year from the preferential rates that the Philippines will apply to key imports from the United States.
But he said the figures were not yet final as US President Donald Trump’s Aug. 1 tariff deadline drew near.
“We just selected [the US goods] that do not compete with local industries and are beneficial to consumers,” the finance chief said, reiterating assurances also made by other economic managers.
Still among lowest
He stressed that the Philippines still got one of the lowest US tariffs in the world.
“That’s beneficial to us,” he added.
After a bilateral meeting with Trump in Washington last week, President Marcos confirmed that the United States would proceed with the imposition of a 19-percent tariff on Philippine exports, higher than the 17 percent rate announced in April but slightly below the 20 percent floated earlier this month.
The revised tariff rates placed the Philippines, alongside Indonesia, with the second-lowest in Southeast Asia. Singapore, which has a bilateral Free Trade Agreement with the United States, has the lowest at 10 percent. US tariffs for other Southeast Asian countries range between 19 percent and 49 percent.
To compare, Trump had said the baseline tariff rate for the world will be “in the range of 15 to 20 percent, probably one of those two numbers.”
In exchange, the Philippines agreed to scrap tariffs on American automobiles and boost the importation of US soybeans, wheat and pharmaceutical products.
Sona silent on deal
Marcos made no mention of the recent trade deal in his fourth Sona delivered on Monday.
Recto on Tuesday said the zero tariff on US wheat and medicines would benefit consumers and should not hurt local producers.
In 2024, the Philippines sold $4 billion more in goods to the United States than it bought.
Filipino exports to the American market hit $12 billion, making up 16.6 percent of the country’s overall export earnings.
“I think that’s favorable to us,” Recto added.
