If there’s a particular industry that will benefit from the Philippine-Korea Free Trade Agreement that will take into force this 31 December, it’s the exporters and traders of agricultural products such as bananas and pineapples, the Board of Investment (BoI) said.
Earlier, the Korean Embassy disclosed that its FTA with Manila would enter into force “a year ahead of schedule,” coinciding with the 75th anniversary of diplomatic ties between the Philippines and South Korea.
The Embassy noted: “The FTA will unlock significant opportunities for both countries. By fostering deeper trade and investment ties across key sectors such as industry, agriculture, infrastructure, and energy, the agreement will pave the way for economic growth.”
With this, Trade Undersecretary and BoI managing head Ceferino Rodolfo noted that the entry-into-force of the bilateral FTA on the very last day of 2024 holds not just ceremonial significance — as we celebrate 75 years of our diplomatic relations — but also brings tremendous commercial benefits to our banana and pineapple growers and processors.
‘The FTA will unlock significant opportunities for both countries. By fostering deeper trade and investment ties across key sectors such as industry, agriculture, infrastructure, and energy, the agreement will pave the way for economic growth.’
“In literally a span of just two days (from 31 December to 1 January), our exporters of bananas will benefit from a 12 percentage-point reduction in the tariffs that they face in the South Korean market — a very significant 40 percent reduction in tariffs,” he said.
In addition to bananas, Rodolfo said another notable product category that will benefit is canned pineapples — “from the 36 percent duty they are currently paying, this will drop to just 25.7 percent by 1 January (for a 29 percent decline).”
“And for these very tangible economic gains, we are deeply thankful for the tireless efforts of four officials. Secretaries Cristina Roque and Frederick Go for intensely advocating for the FTA to enter into force in 2024; and the strong partnership and initiative shown by the Korean Ambassador to the Philippines, His Excellency Lee Sang-hwa. And equally important, our own Ambassador to Korea, Her Excellency Maria Theresa Dizon-De Vega who tirelessly campaigned for Korea’s ratification of the FTA,” according to Rodolfo.
‘The prices of bananas being sold to middlemen should rise for them to benefit in the FTA. But for consumers, there is minimal savings for consumers from the drop in tariff rates.’
Asked if farmers will also benefit from the Korea-Phl FTA, Rodolfo said, “They should as they are the ones producing the said agriculture yields.”
“The prices of bananas being sold to middlemen should rise for them to benefit in the FTA. But for consumers, there is minimal savings for consumers from the drop in tariff rates,” according to Rodolfo.