ALTHOUGH experts have repeatedly expressed doubt that concrete steps to totally ease tensions can be achieved in a short time, a local export organization remains optimistic that the US and China can reach an equitable agreement.
“It’s only a ceasefire. They will still meet and talk. I just hope both sides can reach an equitable agreement within the 90-day window. Though we are hopeful things could go back to where it is today,” said Philippine Exporters Confederation-Cebu executive director Fred Escalona.
He said that since the trade war of the two economic giants began, countries with trade ties to the US and China have been affected.
“There are no winners in a trade war between two of the world’s biggest economies,” said Escalona, adding that the tariff fight is affecting trade performance badly. “Our exports are dramatically down while imports are up.”
Escalona said that so far, the months of October and November were rather bad. The month of December might show an uptick because of Christmas.
US President Donald Trump and Chinese President Xi Jinping met at the G-20 Summit in Argentina on Dec. 1.
Trump agreed not to raise tariffs on $200 billion worth of Chinese imports from 10 percent to 25 percent in January 2019 as he had previously threatened. On the other hand, China agreed to buy a “not yet agreed upon, but very substantial amount of agricultural, energy, industrial” and other products from the US to reduce America’s huge trade deficit with China, according to a statement from the White House.
But if the two countries fail to reach a deal at the end of 90 days, the tariffs will be implemented, the White House added.
Socioeconomic Planning Secretary Ernesto Pernia, in a previous interview, warned that the US-China trade skirmish may not affect the country in the short run, but if the trade war lingers and will not be resolved, it will have an adverse impact in the medium to long term. It may also hurt the appetite of global investors.
The Philippines enjoys the General System of Preference privilege with the US, covering 3,500 product lines that enter the US market at zero percent duty.
China was the country’s biggest supplier of imports, with a 20.6-percent share in October 2018, according to the Philippine Statistics Authority.
Import bills to this country registered an amount of $2.13 billion, or an increase of 28.2 percent, from $1.66 billion in October 2017.
The US ranked fourth in terms of imports, with a seven-percent share of the total import bills in October 2018. Its import bills rose by 3.9 percent, from $694.85 million in October 2017 to $721.71 million in October 2018.
The US ranked first in exports, which were valued at $996.86 million or 16.3 percent of the total exports for October 2018. (KOC)