Years ago when I was studying at Yonsei University in Seoul as a fellow of Korea Press Center, a government agency in South Korea, I wondered at how the Koreans were able to achieve great leaps in information technology. Their night markets were also good sources of fine clothes, both for men and women, and imitation handbags (kabang) that carry designer brands.
It was a time when our limited exports to South Korea were coconut charcoal from Luzon, Dole bananas from Mindanao and chromium from the Zambales ophiolite. They like the bulgogi when cooked with our coconut charcoal as fuel.
The Filipinos I met in Seoul were workers in factories making clothes, many of them doing embroidery. There were also businessmen and professionals involved in sales and marketing; also engineering. Others are musicians and entertainers working in the hospitality industry.
The chaebols have pushed Korea to new heights of capitalism and consumerism, and the result was internationally respected brands such as Lotte, Hyundai, Samsung, etc. Over the years, the Philippines looked up to Korea as a friend and trading partner, and source of technology transfer and official development assistance.
Last week, President Ferdinand Marcos Jr. said he expects the Philippines and South Korea to ratify the free trade agreement (FTA) this year, following its signing by representatives of the two countries. The President pointed out the FTA could give Philippine products reduced tariff rates in the Korean market.
He noted however that South Korea’s National Assembly is yet to ratify the FTA signed between the two
countries.
“I think so. I think we will get it done. I think we will get it ratified …it’s important to us,” President Marcos said in an interview with Maeil Business Newspaper chairman and publisher Chang Dae-Whan in Malacañang.
“I think one of the lessons we learned during the pandemic, and now after the pandemic is how important trade is, not just to be wealthy, but to be, to have the things that you need, that your people need. So, that’s always the key for us and no country succeeded by cutting itself off,” he said.
The FTA is a pact between two or more nations meant to reduce barriers to imports and exports among them. Under a free trade policy, goods and services can be bought and sold across international borders with little or no government tariffs, quotas, subsidies, or prohibitions to inhibit their exchange.
Citing the Philippines’ importance and the business opportunities, President Marcos said other countries partnering with the Philippines “treat us a very, very important part of all that they do.”
The Philippines wants a separate future agreement with South Korea to encourage
the East Asian country to allow some of our products to have duty-free access to the South Korea market, the President explained.
“We are negotiating a separate future agreement with the Republic of Korea is to encourage them to, perhaps take some, to allow some of our products to be included in the reduced tariff products, and also we hope that we can negotiate with Korea, with South Korea better terms and we get on [the] ASEAN-Republic of Korea FTA,” President Marcos told the business newspaper.
“But this is natural, this is not, I think all the other ASEAN countries have the same thinking. So, there are many areas, the semiconductor, the automotive parts, that’s one area. Fruits, we’re already exporting great many fruits to Korea,” he said.
President Marcos cited tropical fruits like avocados that South Korea included on its list of products that could have reduced tariff rates, as he anticipates more Philippine products would be included on the list.
This year marks the 75th anniversary of diplomatic relations between South Korea and the Philippines.
At present, the top exports of the Philippines to South Korea are electrical machinery and electronics, machinery, mechanical appliances, copper articles, edible fruits, fruit peels and nuts.
In 2022, the Philippines exported $4.22 billion worth of products to Korea. These are integrated circuits ($810 million), coal briquettes ($520 million) and copper ore ($254 million).
The President is on the right track in looking forward to better trade with South Korea, for it will directly benefit the Philippines. More exports which are priced right will mean better incomes for our local manufacturers and agricultural producers, and more jobs for Filipinos.
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