The Philippines posted a $4.4-billion trade deficit in May. — REUTERS

THE PHILIPPINES has signed an agreement with the other 13 members of the Indo-Pacific Economic Framework (IPEF) which it hopes will improve the resiliency of its supply chains, the Department of Trade and Industry (DTI) said on Wednesday.

“Today, we signed the IPEF Supply Chain Agreement, on which negotiations were substantially concluded in May,” Trade Secretary Alfredo E. Pascual said in an online media briefing.

According to Mr. Pascual, the agreement, signed on Tuesday in San Francisco, will help mobilize sustainable investment from IPEF partners.

“This is because we will be viewed as being a reliable partner in terms of being able to supply goods when contracted or needed. Having signed this agreement with our partners sends a positive signal to other IPEF members that the Philippines remains a reliable country,” he said.

“The IPEF Supply Chain Agreement can serve to strengthen the existing supplier base in the Philippines and develop new suppliers for incoming investment from IPEF-based companies,” he added.

Mr. Pascual also said that the agreement will facilitate investment in critical sectors and enable technology and knowledge transfer.

“This agreement makes available technical cooperation, which is important for us, and capacity-building and economic collaboration to increase investment in critical sectors, key goods and related essential services including supply chain logistics,” he said.

“This capacity building is important as this will enable us to make our logistics more efficient,” he added.

Mr. Pascual said that the motivation behind the agreement is the experience of the pandemic and the disruptions to trade that resulted from the Russia-Ukraine war.

“The idea is to have a way of working together to address disruptions brought about by extraordinary events,” Mr. Pascual said.

Aside from strengthening IPEF supply chains, the agreement also aims to promote regulatory transparency.

Under the agreement, each country commits to publish its domestic laws and regulations related to supply chains and provide other countries an opportunity to comment on the regulatory regime.

To monitor the members’ progress, signatories will establish an IPEF Supply Chain Council, which will include a senior official from the central level of government of each country. It will meet annually to report on the action plans of each member.

The council will also organize the IPEF Supply Chain Crisis Response Network and the IPEF Labor Rights Advisory Board.

IPEF members apart from the Philippines are the US, Australia, Brunei, Fiji, India, Indonesia, Japan, Malaysia, New Zealand, Singapore, South Korea, Thailand, and Vietnam. — Justine Irish D. Tabile