Philippines to push for critical minerals deal with United States

MANILA, Philippines — The Philippines, which sees a greater chance of securing a sector-specific trade agreement with the United States rather than a full free trade agreement (FTA), will actively push for a critical minerals deal under Trump 2.0.

Ambassador to the US Jose Manuel Romualdez said during the US-Philippine Society (USPS) press conference yesterday that the Philippines has a chance to renew discussions for an FTA with the US that took place under President Donald Trump’s first term.

“I think we do have a good chance of being able to do that, but I think it will have to be sectoral. It can’t be the entire – the whole FTA,“ Romualdez said.

Based on a recent conversation with former US commerce secretary Wilbur Ross, he said the advice given to him was to pursue a sectoral type of FTA.

Romualdez said the Philippines could start with a critical minerals deal with the US.

“We’ve been pursuing the critical minerals agreement with the US even during the Biden administration and we will pursue it even more vigorously this time because, again, it will be mutually beneficial for both the US and the Philippines,” he said.

He said the critical minerals sector is important for the Philippines, which is rich in natural resources like nickel.

The US, on the other hand, needs nickel for batteries that power electric vehicles.

By having a critical minerals processing deal with the US, Romualdez said the Philippines could get better prices for its nickel, if this could be processed here.

At present, China is purchasing more than 90 percent of the Philippines’ nickel ores.

“I think people should realize that the Philippines, actually, the minerals that we have in this country is top grade. In the world, we’re somewhere in between number two and three, somewhere in the top three, what they call very valuable types of minerals, high grade. We have it here and we should use that as a bargaining chip to be able to get better prices,” Romualdez said.

He also cited the semiconductor industry as an area where the Philippines could work with the US, as Trump pushes to bring back semiconductor manufacturing to American shores.

“We are one of seven countries that have been identified as trusted allies of the US. So we can be a recipient of some of that semiconductor industry that’s being moved out of China and moved back either to the US or trusted allies,” Romualdez said.

He expressed hope that these could be part of conversations between President Marcos and Trump being arranged to take place around April this year.

He said the Philippines is also hopeful the US Generalized System of Preferences (GSP) would be renewed.

The Philippines was a beneficiary of the GSP, which allowed the duty-free entry of products to the US.

The program expired at the end of 2020.

Earlier, Trade Undersecretary Ceferino Rodolfo said the Philippines would actively be pushing for an FTA with the US, given the interest in it shown by Washington during Trump’s first term.

Rodolfo told reporters yesterday that an FTA between the Philippines and the US would not only be beneficial for the country, but also other countries in the region.

“The (Philippines’) partners within the region such as Japan and South Korea needs us to have an FTA with the US so that they can secure a non-China supply chain for certain critical industries including for example our minerals for batteries,” Rodolfo said.

In the same event, USPS member Jose Rene Almendras said that amid changes happening in the US, the USPS sees the need to adapt to these changes.

The USPS is private sector initiative aimed at expanding interaction and understanding on various areas including security, trade and investments between the US and the Philippines.

“We are not going to be adversely affected thanks to efforts of Ambassador Romualdez and the USPS, but we also should not be complacent. We need to adapt as fast as we can,” Almendras said.

He said US companies continue to see investment opportunities in the Philippines, with five expressing interest to set up operations here, including energy firms.

“The opportunities for investments in the Philippines are still good,” he said, noting the country, however, needs to act on issues like power supply.