In photo: DTI Undersecretary Ceferino Rodolfo and Vice Minister for Trade Rodrigo Yáñez signing the MOU
By Alithea De Jesus
It’s done deal and this is just the beginning, as the best is yet to come between the Philippines and republic of Chile.
With the recent signing of MOU between Undersecretary for Industry Development and Trade Policy Group of the Department of Trade and Industry of the Republic of the Philippines Dr. Ceferino S. Rodolfo and Vice Minister for Trade of the Ministry of Foreign Affairs of the Republic of Chile Mr. Rodrigo Yáñez done virtually last March 30, 2021, this Memorandum of Understanding (MOU) for the Establishment of a Joint Economic Cooperation (JEC) between the two countries will spur more opportunities.
The signing of the MOU is a significant milestone for both economies as it represents the first trade and investment mechanism of the Philippines to formally engage the South American Region.
In his remarks, Undersecretary Rodolfo highlighted, “The JEC will serve as a confidence building measure to further intensify the bilateral economic linkages while addressing the challenges posed by geographic distance and generally low-level of awareness by businesses in each other’s markets”. He also added that the JEC will be a “tool for engagement on enhancing current levels of trade and investments, discussing various cooperation initiatives in areas of mutual interest, and promoting better synergies with businesses.”
Vice Minister Yáñez underscored in his remarks that international trade is key to economic recovery and emphasized that, “It is of the utmost importance for our countries to define practical steps to foster open trade, enhance global value chains and support innovation and technology”. He further conveyed Chile’s commitment to ”build on the historic and friendly relations and begin a new stage of active collaboration towards achieving a mutually beneficial relationship with the Philippines.”
Also in attendance during the signing were Chilean Ambassador to the Philippines Claudio Rojas, Philippine Ambassador to Chile Teresita Daza, and representatives from the Department of Trade and Industry and Department of Foreign Affairs of the Philippines, and the Ministry of Foreign Affairs of Chile.
Pictured above: Group photo with Chilean Ambassador to the Philippines Claudio Rojas, Philippine
Ambassador to Chile Teresita Daza, representatives from DTI, DFA, SUBREI and DIRAPAC
In his remarks, Ambassador Rojas highlighted the complementary nature of the Philippines’ and Chile’s bilateral relationship that comes with a fruitful space for growth and diversification of linkages between the two countries. He stressed the importance of the newly established JEC “to address and to tackle the overall assessment of economic and trade issues in the areas of trade facilitation, trade promotion, and investment, and could produce a profound impact in the overall relationship between Chile and the Philippines.”
Meanwhile, Ambassador Daza emphasized in her remarks that notwithstanding the two countries’ cordial and growing relations, there is substantial scope and opportunities to strengthen economic ties. She underscored that “The JEC is thus significant as both sides will explore ways to promote trade and economic cooperation through the exchange of information in economic issues and concerns, the identification of sectors where cooperation can be intensified, and the recognition of measures for trade and investment expansion and diversification, among others.” Furthermore, she added that “This initiative comes at a time when our countries are facing serious challenges across different fronts and with varying intensities because of, and exacerbated by, the Covid pandemic that is far from over.”
After the signing, a bilateral meeting between Undersecretary Rodolfo and Vice Minister Yañez took place wherein both Vice Ministers vowed to work closely together and collaborate towards growth in trade and investment in light of the current pandemic.
Undersecretary Rodolfo also expressed the Philippines’ interest to join the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP).
It may be recalled that DTI Secretary Ramon Lopez has formally written to New Zealand as the depositary of the agreement inquiring on the process of accession.
Vice Minister Yáñez conveyed Chile’s support for the Philippines’ accession to the CPTPP and shared that Chile is currently in the process of ratifying the agreement through its legislative body. He said that their technical team will be available to guide and assist the Philippines in the process.
Meanwhile, notwithstanding the invitation to join the Regional Comprehensive Economic Partnership (RCEP), Vice Minister Yáñez emphasized Chile’s interest to accede to the ASEAN-Australia-New Zealand Free Trade Agreement (AANZFTA) as its current priority.
Following the receipt of an official letter from Chile’s Foreign Minister Andrés Allamand, Undersecretary Rodolfo conveyed Secretary Lopez’s directive to support Chile’s accession to AANZFTA.
Both Vice Ministers emphasized that the signing is a valuable achievement in strengthening its bilateral relations, as this year marks the 75th anniversary of Philippines and Chile’s diplomatic relations. Undersecretary Rodolfo thanked Chile for the cooperation and support they have extended in finalizing the MOU and conveyed his hope “for a stronger and more dynamic engagement with Chile through the JEC complemented by existing mechanisms in ASEAN, APEC, and the WTO.”
The Philippines and Chile agreed to convene the 1st Philippines-Chile JEC within the year to sustain the momentum of bilateral discussions. During the bilateral meeting between Secretary Lopez and then DIRECON Director General Yáñez at the sidelines of the APEC meeting in Papua, New Guinea in May 2018, Secretary Lopez first proposed the establishment of a JEC as a framework for engagement, emphasizing that this will serve as a building block towards enhanced relations.
In 2020, Chile was the Philippines’ 54th major trading partner (out of 224), 52nd export market (out of 211), and 52nd import supplier (out of 205). Total bilateral trade between the two countries was valued at USD 59.71 million in the same year.
Chile recorded USD 8,428.42 million worth of net outflows of foreign direct investment (FDI) in 2019 primarily in the sectors of services, finance and insurance, and electricity gas. However, from 2010–2020, there were no approved investments from Chile to the Philippine
