Secretary Ramon Lopez joined other Trade Ministers from the Association of Southeast Asian Nations (ASEAN) and the Honourable Mary Ng, Minister of International Trade, Export Promotion, Small Business and Economic Development of Canada in announcing the launch of the ASEAN-Canada FTA (ACANFTA) negotiations at the 10th AEM-Canada Consultation held via video conference on 17 November 2021.
There was a strong recognition among the countries that tackling the economic disruptions of the COVID-19 pandemic needs an enhanced international trade and regional cooperation. In this respect, the Ministers announced the launch of the ACANFTA negotiations as a clear and concrete reaffirmation of the commitment to open markets, trade, and investment.
The announcement is a result of an almost five-year long discussion and evaluation for a possible ACANFTA. In 2018, the results of the joint feasibility study show that there is value in pursuing an ACANFTA with ASEAN’s GDP increasing by USD 39.4 Billion or 1.6% while Canada’s GDP would increase by USD 5.1 Billion or 0.3% due to increased economic activity arising from tariff liberalization, reduction of non-tariff measures, and improvements in trade facilitation. The study also showed that the Philippines is estimated to gain a 2.63% increase in GDP (or USD 7.4 Billion) as a result of an ACANFTA.
Trade policy dialogues were also conducted, and after due negotiations, a reference paper providing the possible scope and coverage of an ACANFTA was finalized. In the reference paper while it is apparent that there are still some areas of divergence DTI Secretary Lopez highlighted that, still, there is a great number of common interests and priorities between ASEAN and Canada.
“We are pleased to see that ASEAN and Canada share common values and shared priorities which shows that there is value in pursuing a trade agreement with Canada, and we support the launch of the ASEAN-Canada FTA negotiations,” DTI Secretary Lopez added.
Recognizing that post-economic growth and recovery should be one that is inclusive and sustainable, DTI Secretary Lopez also highlighted the country’s openness to engage ASEAN and Canada in non-traditional areas of trade including labor, environment, culture, and other issues such as gender and indigenous people.
DTI Secretary Lopez said, “On these diverging and new FTA areas, rest assured that the Philippines is willing to engage and find a mutually acceptable level of ambition especially since these areas are important in pursuing sustainable development and inclusive growth.”
As a next step, Ministers tasked Senior Economic Officials to work closely together in developing a work plan that will move forward the FTA negotiations. This may include an official scoping paper exercise that will further flesh out the diverging areas between some ASEAN Member States and Canada. Discussions are expected to commence by early 2022.
In 2020, Canada was the 18th major trading partner of the Philippines amounting to 925.7 Million USD. Canada was also the 19th largest export market of the Philippines with exports amounting to 400 Million USD, and 22nd biggest import supplier of the country with Philippine imports from Canada valued at 525.6 Million USD. Trade relations between the Philippines and Canada is expected to deepen through an ACANFTA and contribute to post-pandemic economic recovery.
Read the Joint Statement of the 10th AEM-Canada Consultations here: https://asean.org/wp-content/uploads/2021/11/Joint-Media-Statement-for-the-10th-AEM-Canada-Consultation_adopted.pdf
