US tariff hike: A boon for Philippines manufacturing

CEBU, Philippines — The latest wave of U.S. tariff increases targeting key Asian economies may be setting the stage for a strategic rebalancing in global manufacturing—one in which Cebu, a historic furniture export powerhouse, is poised to reclaim a central role.

Business leaders in the Philippines see the policy shift as a potential inflection point, presenting new competitive advantages for the archipelago nation amid tightening global trade dynamics.

In an interview with Leslie D. Lim, president of the Federation of Ecozone Service Providers–Visayas Chapter and CEO of LDL Group of Companies, she said that the Philippines’ relatively moderate 17 percent tariff rate—compared with the higher duties now levied on goods from Vietnam, China, Thailand, and South Korea—offers a compelling case for multinational manufacturers to relocate operations.

“This shift in tariff policy may catalyze a reallocation of global manufacturing footprints. For firms seeking to maintain cost efficiency in exports to the U.S., the Philippines, particularly Cebu—now represents an increasingly viable alternative,” she explained.

Cebu, known globally for its artisanal craftsmanship and once considered the epicenter of high-end furniture exports before the 2008 global financial crisis, is especially well-positioned to benefit from the evolving trade environment.

Lim noted that with major manufacturers in Vietnam and Indonesia facing increased cost pressures, a return to Philippine shores is becoming a rational strategic choice.

“We are seeing early signals that global furniture brands are reassessing their supply chain strategies,” Lim said. “Cebu’s legacy, infrastructure, and workforce expertise in this space offer a ready-made platform for rapid re-entry into the global market.”

The tariff action is widely seen as part of the U.S. government’s broader campaign to recalibrate trade relationships and address long-standing imbalances. While concerns remain about downstream impacts on complex, regionalized supply chains—particularly for semi-finished goods—Lim emphasized that the policy shift could unlock significant upside for manufacturers of fully finished export products.

“This is a decisive move by Washington to safeguard domestic industries,” she said. “Yet it inadvertently creates a corridor of opportunity for emerging economies like the Philippines to step into the vacuum created by rising production costs in other Asian markets.”

Lim’s firm, LDL Group, ranks among the largest logistics and supply chain operators in the Philippines, serving multiple international clients across the country’s economic zones.

She underscored Cebu’s readiness to capitalize on shifting investment flows, citing its modernizing infrastructure, deep talent pool, and globally recognized reputation for quality manufacturing.

Industry leaders are now calling on both the Philippine government and private sector stakeholders to align efforts and accelerate investment in Cebu’s manufacturing and export ecosystem.

Strategic incentives, streamlined regulatory pathways, and targeted infrastructure upgrades could position the province as a flagship destination for foreign direct investment in the region.

“With global manufacturers reassessing geopolitical risks and tariff exposure, Cebu has a unique window to reassert itself as a key node in global supply chains. The opportunity is real—but it requires bold, coordinated action to seize it,” Lim concluded.