By Justine Irish D. Tabile, Reporter
MOST of the Philippines’ agricultural exports are now exempted from the 19% US reciprocal tariff, according to government officials.
At a press conference on Tuesday, Trade Secretary Ma. Cristina A. Roque said that the exemption, which was provided under US President Donald J. Trump’s latest executive order, will provide relief to some Filipino exporters.
“With this last executive order, the majority of our agricultural exports in the United States are now exempted from reciprocal tariffs,” Ms. Roque said.
“This includes coconut, coconut oil, coconut water, desiccated coconut, fruit juices, processed pineapples, confectionary goods, fresh and processed bananas, tuna filets, and dried fruits such as bananas, guavas, mangoes, mangosteens, and pineapples,” she added.
These products generated over $1 billion in export value last year.
“These industries sustain thousands of Filipino farmers, micro, small, and medium enterprises, and rural workers, and this decision offers not only immediate relief but also renewed confidence and stability,” Ms. Roque said.
Last week, Mr. Trump issued an executive order modifying the scope of the reciprocal tariffs with respect to some agricultural products. This meant that hundreds of food products, including bananas, coconuts, coffee, pineapples and beef were exempted from the higher US tariffs. The order took effect on Nov. 13.
Prior to this order, most goods from the Philippines have been slapped with a 19% US tariff since August.
Ms. Roque said that this exemption will help keep Philippine agricultural exports competitive in the US market.
“The exemption helps protect livelihoods, preserve jobs across our agricultural value chains, and create opportunities for communities that rely heavily on exports for income and growth,” she added.
To recall, the Philippine government has sought an exemption for certain products such as coconut and its derivatives, carrageenan, sugar, mangoes, cacao, coffee, and avocados, as well as other industrial products.
“This development builds on earlier exemptions extended to semiconductor exports, which represent nearly 25% of our shipments to the US, or roughly $2.5 billion to P3 billion annually,” Ms. Roque said.
“While our engagement continues, this recent development shows our constructive engagement and sends a clear message of partnership and continued confidence in our enduring economic ties,” she added.
According to the Department of Trade and Industry (DTI), the exemption of agricultural products from the US reciprocal tariff brings the total value of exempted products to $6.8 billion.
“So, 46% of our exports, using 2024 figures, to the US are now exempted from 19% tariffs,” Trade Undersecretary Ceferino S. Rodolfo said.
Special Assistant to the President for Investment and Economic Affairs and incoming Finance Secretary Frederick D. Go said that the tariff exemption for agricultural products is a good development.
“A huge part of our export to the US after semiconductors is actually coconut. So, that’s why it’s very important to us, which is why when we were negotiating with the US, we were stressing that there are so many products that are either not produced in the US or produced in very little quantity,” he said.
According to Mr. Go, 60% of the $1 billion in exempted agricultural products are composed of coconuts and their derivatives.
He said that the Philippines continues to seek exemption for other exports, including garments, travel accessories, and furniture.
“We haven’t secured that, but I hope we can be successful in the future,” he added.
Mr. Go said the exemption will boost agricultural exports, but not instantly.
“I think agriculture by its very nature also needs more gestation, more planning, and more logistical play,” he said.
“But it’s still good news. And I think when it comes to investments, for example, especially in the agricultural sector, news like this is what investors are looking for. Good news like this will encourage them to make significant investments in the agricultural sector,” he added.
Mr. Go said he is encouraging entrepreneurs and companies to invest in the export industries that will benefit from the exemption.
Agriculture Secretary Francisco P. Tiu Laurel, Jr. also welcomed the development but noted the blanket exemption is for all the countries exporting those products to the US.
“It is good news na may exemption… but na-exempt din ang ibang major competition natin (but our major competitors are also exempted), so it’s back to normal,” he told BusinessWorld.
“The good thing is wala na anxiety ang industries, and we can plan and move forward,” he added.
Mr. Rodolfo said that the DTI is working with the Department of Agriculture (DA) on the production side and the promotional efforts for coconut products to ensure that they remain competitive.
Mr. Go said that the DA has allotted a significant part of its budget to rebuilding the coconut industry in the Philippines.