Makati City, Philippines—The Senate of the Philippines adopted Senate Resolution No. 192, entitled: "Resolution Concurring in the Free Trade Agreement (FTA) Between the Government of the Republic of the Philippines and the Government of the Republic of Korea." With 21 senators voting in favor, the Senate's concurrence completes the country's ratification process of the trade deal.
Under the agreement, it will enter into force on the first day of the second month, following the date of the exchange of the written notifications through diplomatic channels or on such other date as agreed upon by the Parties. Currently, Korea is completing its domestic ratification process, which is expected to be finalized in the coming months.
"This bilateral FTA is not only a pivotal agreement in enhancing our trade and investment relations with South Korea but is also well aligned with the current trade policy direction of the country under the Philippine Development Plan 2023-2028 (PDP 2023-2028). It aims to advance purposive, assertive, and forward-looking FTAs to expand economic space and increase our participation in global supply chains," DTI Secretary Cristina A. Roque said.
Roque underscored as she emphasized the department's focus on aggressive and intensive international trade.
Undersecretary Allan B. Gepty elaborated on the FTA's significance: "The trade deal is another milestone in the Philippine-Korea economic relations as we celebrate our 75th anniversary of diplomatic relations this year. Moreover, the bilateral FTA is timely as it complements the recently implemented Regional Comprehensive Economic Partnership (RCEP) Agreement. Once effective, this will increase the preferential market access of Philippine exports to Korea to around 97% in terms of trade value, compared to 90% under RCEP."
Reinforcing this sentiment, Senator Imee R. Marcos, in her sponsorship speech for the Senate concurrence, highlighted, "Through the FTA, the Philippines will expand its network and encourage the entry of sustainable and high-quality investments. It will also foster a forward-looking commitment to economic cooperation in priority areas such as industrial development, innovation, research and development, micro, small and medium enterprises, and the creative and cultural industries."
At present, bananas are our top agricultural export to South Korea, with a tariff rate of 30%. In contrast, bananas from Vietnam and Indonesia already enjoy a 0% tariff rate. While the Philippines' market share of bananas was 98.80% in 2013, it has significantly declined to 69% in 2023. Meanwhile, Vietnam's share increased from 0.04% in 2013 to 12% in 2023.
The bilateral FTA with South Korea is projected to boost Philippine market access for tropical fruits, especially bananas and processed pineapples. Under the FTA, exports of essential Philippine products to South Korea, including fresh bananas in five years, will enjoy zero tariffs.
Other agricultural products from the Philippines that gained preferential market access to Korea through the FTA are yellowfin tuna, processed pineapple, pineapple juice, prepared or preserved oysters, fresh blue crabs, fresh guavas, fresh papaws or papaya, canned sardines, and fresh tilapia.
Beyond agricultural trade, the agreement aims to foster economic cooperation to attract investments in forward-looking sectors such as critical minerals processing, electric vehicles, and parts manufacturing.
For industrial products, Philippine menswear and other apparel goods such as trousers, shirts, jackets, and blazers also gained preferential market access to Korea.
Both parties also signed an implementing agreement to strengthen collaboration on priority sectors for trade and investment under the Economic and Technical Cooperation. Under this, the Philippines and South Korea will begin consultations within six months of the agreement's entry into force to identify projects for cooperation.
Priority sectors include e-vehicles, health cooperation, vaccine manufacturing, critical minerals processing, innovation, research and development, creative and cultural industries, and
e-commerce. Cooperation in these areas may involve information exchange, sharing of best practices, technical assistance, joint research and development, and transfer of technology or new business models, among others.
The Philippines-South Korea FTA marks the country's third bilateral FTA. Currently, the government has two bilateral FTAs in force: the Philippines-Japan Economic Partnership Agreement and the Philippines-European Free Trade Association FTA.
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