MANILA – The Philippines has agreed to eliminate tariffs on certain US-made products — particularly automobiles — in exchange for a modest but symbolically significant trade concession from Washington: a 1-percentage point cut in tariffs on Philippine goods entering the United States.
US President Donald Trump announced the development on Tuesday (Wednesday in the Philippines), following a bilateral meeting with Philippine President Ferdinand “Bongbong” Marcos Jr. at the Oval Office.
Trump hailed the agreement in a social media post, stating the Philippines “is going open market with the United States with zero tariffs.” Marcos, however, clarified that the zero-tariff policy applies only to specific sectors.
“There were certain markets that they asked to be opened that are presently not opened,” Marcos said.
“Like automobiles. We will open that market and no longer charge tariffs on that.”
According to the US Office of the Trade Representative, the Philippines previously imposed steep tariffs on imported vehicles — 30% on passenger cars and 20% on buses and trucks.
In contrast, Washington agreed to reduce tariffs on Philippine exports to the US from 20% to 19%, a move Marcos defended as a meaningful gain.
“One percent might be a very small concession, however when you put it in real terms, it is a significant achievement,” he said. “They told us it (lower tariff) is because of the special relationship between the Philippines and the United States.”
The President added that Manila would also increase its purchases of American products under the new trade deal.
“There will be increased importation from the United States for soy products, wheat products and medicine,” he said. “There are a lot of details that need to be worked out, but so far that is our template — the 19 percent.”
The tariff cuts come as the latest evolution in trade talks between the two long-time allies. In January 2023, Marcos had already signed Executive Order No. 12 removing tariffs on electric vehicles, although hybrid electric vehicle imports remain subject to duties ranging from 1% to 5%.
Marcos is the first Southeast Asian leader to meet Trump in the latter’s second term as US president./PN
