Korea urges Phl to utilize Asean FTA

MANILA, Philippines - Philippine firms are urged to increase its utilization of the Association of Southeast Asian Nations (ASEAN) – Korea free trade agreement (FTA) by importing more products from the latter to better realize the benefits of the deal.

Speaking at the Korea-Philippines FTA forum held yesterday, Kim Sungchul, deputy director of Korea’s Ministry of Strategy and Finance, said that while there has been an increase in trade between the ASEAN and Korea since the agreement entered into force in 2007, firms in the ASEAN including the Philippines have not really utilized the FTA in terms of imports.”

There is a need to utilize FTA when importing too and not just exporting,” he said.

He noted that the utilization rate of ASEAN firms of the ASEAN-Korea FTA in terms of exports is at 67.5 percent.

In contrast, the utilization of the FTA of ASEAN firms in terms of imports is at a lower 33.1 percent.

Korea’s Ministry of Strategy and Finance director Hwang Byoungha said in the same event they want Philippine firms, particularly those importing goods from Korea, to increase its utilization of the FTA by importing more to better enjoy the benefits of the deal.

“Maybe the main importers from the Philippines have little information so they can’t really utilize the FTA. Our main policy is to make it (utilization) higher,” he said.

Kim said the utilization of the ASEAN-Korea FTA is expected to lead to increased trade between the parties through the elimination of tariff and non-tariff barriers as well as creation of conducive market conditions.

He said the utilization of the deal is likewise seen to result in higher investments in both parties, as well as an increase in productivity which could promote economic growth.

Consumers, he said, would also benefit from increased utilization of the ASEAN-Korea FTA as they would have more products to choose from.

To improve the utilization of the FTA in Korea, he said the Korean government is implementing programs which includes training experts and consultants as well as holding information sessions with enterprises, among others.

Kim noted that trade between the Philippines and Korea has risen to $10.91 billion in 2011 from $6.858 billion in 2007.

As for a possible bilateral agreement between the Philippines and Korea, Bureau of Export Trade Promotion director Senen Perlada said it is being studied by the government.

The Korean Chamber of Commerce Philippines said earlier Korean businesses would want South Korea and the Philippines to have a bilateral free trade agreement similar to the bilateral agreement of the latter with Japan to further enhance trade.