Philippines backs ASEAN FTA with Canada

MANILA, Philippines — The Philippines is supporting negotiations for a free trade agreement (FTA) between the Association of Southeast Asian Nations (ASEAN) and Canada as it expects the deal to strengthen trade ties and post-pandemic recovery.

“We are pleased to see that ASEAN and Canada share common values and shared priorities which shows that there is value in pursuing a trade agreement with Canada, and we support the launch of the ASEAN-Canada FTA (ACANFTA) negotiations,” Trade Secretary Ramon Lopez said.

Lopez joined other ASEAN trade ministers and Minister of International Trade, Export Promotion, Small Business and Economic Development of Canada Mary Ng in announcing the launch of negotiations for the ACANFTA through a virtual conference last Nov. 17.

The DTI said the ACANFTA is seen to help deepen trade relations between the Philippines and Canada and contribute to post-pandemic economic recovery.

Recognizing the need to promote inclusive and sustainable post-economic growth and recovery, Lopez conveyed the country’s openness to engage other ASEAN members and Canada on non-traditional areas of trade including labor, environment, culture, as well as gender and indigenous people.

“On these diverging and new FTA areas, rest assured that the Philippines is willing to engage and find a mutually acceptable level of ambition especially since these areas are important in pursuing sustainable development and inclusive growth,” he said.

The DTI said the announcement of the launch of negotiations for the ACANFTA is a result of almost five years of discussion and evaluation.

It said a joint feasibility study in 2018 showed there is value in pursuing an ACANFTA with both ASEAN and Canada’s economic growth seen to pick up.

ASEAN’s gross domestic product (GDP) is seen to increase by $39.4 billion or 1.6 percent, while Canada’s GDP would rise by $5.1 billion or 0.3 percent from tariff liberalization, reduction of non-tariff measures, and improvements in trade facilitation.

The study also showed the Philippines is estimated to gain a 2.63 percent increase in GDP or  $7.4 billion due to the ACANFTA.

Trade policy dialogues were also conducted and a reference paper was also prepared to  provide the possible scope and coverage of an ACANFTA.

Following the announcement of the launch of negotiations, ministers asked senior economic officials to work together in developing a work plan that will move FTA talks forward.

The DTI said the work may include an official scoping paper exercise that will further flesh out the diverging areas between some ASEAN members and Canada.

It added discussions are expected to start early next year.

Last year, Canada was the Philippines’ 18th major trading partner with trade amounting to $925.7 million.

It was also the Philippines’ 19th largest export market with shipments amounting to $400 million last year.

In terms of imports, Canada was the  Philippines’ 22nd biggest import supplier with the shipments valued at  $525.6 million.