Secretary Arsenio Balisacan of the Department of Economy, Planning, and Development (DEPDev) on Tuesday said the country’s expected growth this year is unlikely to be significantly affected by the 19-percent tariff imposed by the United States.

“Not really that much,” he said when asked if the tariff rate would affect the gross domestic product (GDP) projection, citing the country’s diversified export markets.

“Because many more exports go to many other countries, and what happens to those exports with all this reconfiguration of tariffs matters more. Also, how a [country’s imports] are affected by the tariffs, it’s those that are really more significant in terms of quantitative impact,” he told reporters on the sidelines of an Israeli agribusiness forum in Makati City.

He noted that as much as possible the country would want to improve the terms it could obtain from the US.

“But insofar as the government targets, for example, on our GDP that would have no effect,” he said.

He emphasized the need for the country to diversify its export markets, boost productivity, and enhance infrastructure.

“But the focus should really be on addressing the constraints to growth faced by businesses and entrepreneurs, including startups,” he said.

FTA with Israel

Meanwhile, Balisacan said the government has to study a free trade agreement (FTA) with Israel.

“We’ll study it, but anything that will improve the free flow of our exports and imports should benefit the country. If we can get cheaper products from Israel, cheaper than we can get from other countries, then of course if we import from them we’ll be better off,” he said.

“But I think the greater benefits would be in the form of innovations that we can do. I would like to see those more than just the direct value of imports and exports,” he added.

Both countries have signaled a willingness to begin FTA talks.

On Tuesday, a summary of discussions between the Philippines and Israel was signed. This followed the inaugural Philippines-Israel Joint Committee meeting on 1 July, where trade officials of both countries discussed developments in agriculture, innovation, and trade cooperation.

Trade Secretary Cristina Roque said consultations with various stakeholders and industries have yet to begin.

“We hope to push for this FTA with Israel, and we want to accomplish it before the term of PBBM ends,” she said.

Meanwhile, Israeli Economy Minister Nir Barkat said Israel is a believer in FTAs, citing confidence in a relationship with the Philippines. Israel has over 16 FTAs with other countries.