THE PHILIPPINES continues to expect the free trade agreement (FTA) with South Korea to take effect within the year with ratification still pending on the Korean side, according to the Department of Trade and Industry.
“When it comes to the effectivity of the FTA, we are targeting effectivity this year. At least on our side, we’re done with the ratification process,” Trade Undersecretary Allan B. Gepty told BusinessWorld on the sidelines of a budget hearing at the Senate on Tuesday.
“We’re just waiting for South Korea to finish their full domestic process of ratification. But I understand they are now in the process of seeking the approval of their National Assembly,” he added.
He said the optimism stems from the scheduled visit of the South Korean leader next month.
“We are very happy that yesterday, finally, the Senate concurred on the ratification of the bilateral FTA. That is timely because I understand that the president of South Korea (Yoon Suk Yeol) will be visiting the country in October,” he said.
“Of course, it is also good news for our banana industry because if there is one sector that will mainly benefit from the FTA, that will be them,” he added.
South Korea was the country’s third-biggest banana export market last year, accounting for $164.54 million or 13% of fresh banana exports in 2023.
In the first quarter, banana exports to South Korea hit $102.58 million, well ahead of the year-earlier pace.
On Monday, the Senate ratified the FTA between the Philippines and South Korea, which will remove Philippine tariffs on 96.5% of goods from South Korea and Korean tariffs on 94.8% of Philippine products.
Signed in September last year, the FTA allowed the Philippines to secure the elimination of 1,531 tariff lines on agricultural goods, of which 1,417 would be removed after the FTA enters into force.
It will also remove 9,909 tariff lines of industrial goods, 9,747 of which would be removed after the deal enters into force.
According to Mr. Gepty, the agreement will come into force on the first day of the second month, or on such other date as the parties may agree, after they notify the completion of all necessary domestic legal procedures. — Justine Irish D. Tabile