RP expected to sign trade MOU with US

MANILA, Philippines - The Philippines as part of the Association of the Southeast Asian Nations (ASEAN) is expected to enter into a memorandum of understanding (MOU) with the United States to help facilitate smoother trade and minimize the risk of exporters.

Likewise, ASEAN member nations are mulling the possibility of creating a fund for exporters.

In an interview, Trade Senior Undersecretary Thomas G. Aquino said that the Export Import Bank of the United States (US Ex-Im Bank) and the ASEAN Business Advisory Council (A-BAC) will sign a memorandum of understanding (MOU) that will help increase the sale of goods and services between the ASEAN and the US.

The US Ex-Im Bank was created to aid in the financing of creditworthy entities to facilitate the export of goods and services of US origin or manufacture.

In the draft MOU obtained by reporters, it stated that the US Ex-IM bank and A-BAC will exchange information on trade and business opportunities to further the goal of facilitating the sale of goods and services between ASEAN member states and the US.

Also, A-BAC will help identify appropriate business opportunities in the ASEAN which are suitable for US Ex-Im Bank Programs.

At the same time, Aquino explained that the ASEAN is looking at putting their resources in one fund in order to pool the risks. Aquino said the Philippines, being the lead in the trade finance committee, will help conduct a feasibility study on the matter.

“Export financing must be strong in order to ensure additional trade,” the undersecretary noted.

Aquino said that exporters have been complaining that they have no access to funding in spite of assurances from financial institutions that there is enough liquidity in the market.

However, Aquino noted that exporters are not tapping the fund, even the one set up by the Asian Development Bank (ADB), to help them cope with the challenges brought about by the global financial crisis.