By Jenina P. Ibañez
Reporter

TRADE SECRETARY Ramon M. Lopez said that negotiations for a free trade agreement (FTA) with the US could be hampered by the mood in the US Congress, which backed sanctions against Philippine officials, leading Malacañang to threaten to withdraw from the Visiting Forces Agreement (VFA).

“You can get a sense of the mood in the (US) Congress… anything to do with us baka maging (might become a) big issue. Baka hindi sila (They might not be) excited, or may not be supportive,” he said.

President Rodrigo R. Duterte threatened to end the VFA, an arrangement adopted by both countries after the removal of US bases here, after the US canceled the visa of a key Duterte ally, Senator Ronald M. dela Rosa.

Mr. Lopez said he has no specific information on US legislators’ inclinations with regard to a Philippine FTA, but notes that this may be a concern.

“’Yung FTA naman with the US, while we are open to it, siyempre depende rin sa kabilang (it depends on the other) side… The USTR (United States Trade Representative) may be interested, but the Congress I don’t know,” Mr. Lopez said.

“They know our interest is there so hindi na natin i-push ngayon, o i-push (we won’t push for it now or) next month.”

He said that the Philippines has been ready to commence negotiations.

“You have to work with their internal processes (and the) mood in Congress — we don’t know if that represents the whole Congress so baka ilang congressmen lang din ‘yun (it could be just a few legislators). We are leaving it up to them.”

The Philippines currently enjoys zero or reduced tariffs on over 5,000 products under the US Generalized System of Preferences agreement, which ends on Dec. 31, 2020.

The US is one of the Philippines’ top trade partners. It is the Philippines’ top export destination, taking in 16.3% of all exports or $10.55 billion in the first 11 months of 2019. The Philippines imported $7.13 billion worth of US goods, or 7.2% of the total, over the same period.

Asked about the impact on investors of a VFA dispute, American Chamber of Commerce Senior Advisor John Forbes said in a mobile message that investors expect a strong bilateral relationship.

“Investors like to see smooth bilateral relations. AmCham supports US military resources helping with disaster relief, as they did after Typhoon Yolanda, and training jointly with the AFP (Armed Forces of the Philippines). Thus we believe it is very important for the VFA to continue,” he said.

Mr. Lopez added the trade department continues to be open to an FTA with the European Union, even as talks have stalled.

“We have also been open to that. Sila rin ‘yung nag-put (they are the ones who put it) aside I guess for now. Kasi ‘di ba we’re supposed to have a next round of meetings. So hindi naman sila naglalagay ng (they haven’t put up a) schedule. But with the new trade commissioner, we will find out their priorities,” he said.

Delegation of the European Union to the Philippines Charge de Affaires Thomas Wiersing told reporters last week that the FTA is not off the table, but there is currently no agreement on the next round of talks.

Ireland’s Phil Hogan became the new European Commissioner for Trade on Dec. 1, 2019.

University of Asia and the Pacific economist George N. Manzano in a mobile message said investors may adopt a wait-and-see approach as the spat plays out.

“Political tensions in principle are not going to be very helpful in raising investor confidence. But at this stage of sabre-rattling, investors may just adopt a wait-and-see stance,” he said.

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