Philippines Ratifies RCEP to Increase Thailand’s Production-Export Opportunities

     The Department of Trade Negotiations, Ministry of Commerce, said that the Philippines, the last member country to ratify the Regional Comprehensive Economic Partnership (RCEP) agreement, has lifted tariffs on fishing, plastic, glass, and auto parts to help increase the opportunity for Thailand to expand its production networks and the export of products. Thailand can use raw materials from the Philippines to produce goods for export and use raw materials from RCEP members to produce goods and export them to the Philippines.

     The Philippines recently submitted an instrument of ratification of the RCEP to the ASEAN Secretariat. The Philippines is the last member country to ratify the RCEP after 14 other member countries, namely Brunei Darussalam, Cambodia, Lao PDR, Singapore, Thailand, Vietnam, Australia, China, Japan, New Zealand, Myanmar, South Korea, and Malaysia. These fourteen countries had all ratified the agreement earlier. The RCEP will fully enter into force on June 2, 2023 for the Philippines, and it will be assumed that all 15 founding members of the RCEP have ratified the agreement completely.

     The RCEP ratification will result in the Philippines waiving tariffs on fisheries, plastics, glass, and auto parts, which are products that the Philippines had not yet opened the market for under the free trade agreements between ASEAN-China, ASEAN-Japan, ASEAN-South Korea, and ASEAN-Australia-New Zealand. Therefore, this is an opportunity for Thai entrepreneurs to choose raw materials from the Philippines and produce products to export to RCEP members other than ASEAN. Thai businesses can also import raw materials from Japan, South Korea, China, Australia, and New Zealand to use in the production of products to export to the Philippines, which will receive a reduction or exemption from tariffs under the RCEP.

     In 2022, the Philippines was Thailand's fifth-largest trading partner in ASEAN, and it was ranked 14th among Thailand’s trading partners in the world. Trade between Thailand and the Philippines is worth 11,217 million US dollars. Thailand’s exports to the Philippines are worth 7,383 million US dollars, and Thailand’s imports from the Philippines are worth 3,834 million US dollars. Major exports include automobiles, equipment and components, electronic circuit boards, and plastic resin. Important imports include computers equipment and components, integrated circuits, other metal ores, scrap metal, and automotive components and equipment.

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