Favila pushes study on FTA with US

Newly-appointed Trade and Industry Secretary Peter B. Favila is pushing forward with preparations for an eventual free trade pact with the United States.

The DTI had commissioned the Philippine Institute for Development Studies (PIDS) in 2004 to conduct a study on the impact and prospects of a Free Trade Agreement (FTA) with the US.

The study, which covers impact analysis on the general economy as well as on specific industries, is expected to be completed by the end of September.

Beginning October, the findings of the study would be validated through regional public consultations to be held in major cities around the country.

Favila is insisting on the participation of the private sector as key stakeholders in the FTA initiative.

Favila said the government would work closely with the private sector in drawing up the appropriate negotiating strategy, defining in concrete and measurable terms the economic benefits to be derived from an FTA.

"More importantly, we will identify the necessary structural adjustments to ensure that our industries remain competitive in an FTA environment. When these have been established, then the Philippines will pursue formal negotiations with the United States," Favila added.

The United States is presently the second top trading partner of the Philippines, after Japan.

A free trade accord is an avenue to fully realize the potentials of the two countries’ bilateral relationship.

The US has established several regional and bilateral FTAs globally.

In ASEAN, the US has forged an FTA with Singapore and is currently negotiating one with Thailand.

The Philippines, likewise, recognizes the need to forge strategic alliances with key trading partners to ensure global competitiveness.

The Philippines is in the process of concluding an FTA with Japan, and is currently engaged in other bi-regional FTA initiatives.