PH-US Trade Relations
The Philippines and the United States have long enjoyed strong and robust trade relations. Total Philippines – U.S. bilateral merchandise trade has steadily increased from 2017 ($17.44B) to 2018 ($18.70B) and to 2019 ($19.64B). While the Philippines benefits from a slight trade surplus with the United States, our bilateral merchandise trade relationship, on the whole, covers a range of products including electronics, industrial materials, processed foods, and agriculture. The United States is the Philippines’ 3rd largest trading partner following Japan and China.
The start of 2021 saw a US economy surging back from the COVID recession. While this recovery is still in progress, the need for consumer goods and raw materials for manufacturing reached historic levels at the end of Q2 2021. Previous study showed that at a macro-level, the revival of the US economy impacted US – Philippines trade flow positively. Specifically, Philippine exports to the US from January to June 2021 rose to $6.5B from $5B for the same period in 2020. So far, it is also outpacing the 2019 (i.e. pre-pandemic) aggregated value of about $6.2B for Q1+Q2, a truly remarkable statistic since 2019 is generally heralded as a banner year for Philippine exports to the US. Only at the end of this year will we know for certain if this trend endures.
For American companies looking to source products from the Philippines, our country is a beneficiary under the United States Generalized System of Preferences (GSP) Program, which grants duty-free access for thousands of Philippine-made products when imported into the United States. In 2019, the Philippines exported an estimated $1.6B of its products to the U.S. under GSP.
(As reported by the Philippine Trade and Investment Center – Washington DC Office)