By Justine Irish D. Tabile, Reporter
FURNITURE EXPORTERS are seeking substantial government support in light of the 20% US tariff on Philippine goods.
“We really need the government to back us up (with) drastic export policies and funding support,” Chamber of Furniture Industries of the Philippines Director General Ajun L. Valenzuela told BusinessWorld.
The latest US position is that Philippine goods will be charged a 20% tariff starting Aug. 1, though a Philippine delegation will be in Washington to negotiate a lower rate or even a free trade agreement. President Ferdinand R. Marcos, Jr. is also due to visit Washington later this month.
The new rate is higher than the 17% tariff announced in April and level with the 20% that Vietnam is set to pay.
Mr. Valenzuela said that if the negotiations fail to produce a favorable result, the government should take other steps to help exporters in addressing the disruptions that could ensue from the eventual tariff.
“Since the negotiations might not work, I believe the government should make strategic policy changes and support us by providing the exporters emergency measures like fiscal and export incentives,” he added.
Mr. Valenzuela has said that the Philippines’ initial rate of 17% and Vietnam original tariff of 46% was not enough of a gap to make Philippine furniture exports competitive on price.
“Our price difference with Vietnam is around 40%,” he said in May.
Meanwhile, Foundation for Economic Freedom President Calixto V. Chikiamco said it is difficult to say whether the Philippines can attract investments now with a diminished tariff advantage.
“The future is murky with uncertainty over tariffs and overall global developments,” he said via Viber.
He said the Philippines needs to forge free trade agreements to create more manufacturing jobs, seeking deals with “as many countries as possible, including the US, the European Union, the United Arab Emirates, and Canada, and possibly join the Comprehensive and Progressive Agreement for Trans-Pacific Partnership.”
“It also has to assure investors of energy security and modernize its labor laws,” he added.
