Indonesia to cut tariffs, non-tariff barriers in US trade deal —Trump official
Indonesia will immediately drop its plans to levy tariffs on internet data flows and will support renewal of a longstanding World Trade Organization moratorium on e-commerce duties, the official told reports on a conference call held a week after the deal was first announced on July 15.
Indonesia also will remove recently enacted pre-shipment inspection and verifications of U.S. exports, which have posed problems for U.S. agricultural exports and contributed to a growing U.S. farm trade deficit, the official said.
In a win for U.S. automakers, the official said that Indonesia has agreed to accept U.S. Federal Motor Vehicle Safety Standards for vehicles exported from the United States to the growing country of 280 million people. Indonesia also has agreed to remove export restrictions on critical minerals and remove local content requirements products using these commodities shipped to the U.S. —Reuters
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GMA Network
2 hours ago
- GMA Network
Economists say 19% Trump tariff to have limited impact on PH GDP
President Ferdinand 'Bongbong' Marcos Jr. meets with US President Donald Trump in the Oval Office at the White House in Washington, D.C. on July 22, 2025. REUTERS/ Kent Nishimura While Philippine exports to the United States are still set to face a 19% tariff, economists expect only limited impact on the country's economy given its relatively low dependence on American demand compared with other Asian economies, with local exporters bearing the brunt. Early morning on Wednesday (Philippine time), US President Donald Trump announced a new 19% tariff rate for Philippine goods. This is lower than the 20% announced in a letter earlier this month, but higher than the 17% rate announced last April on what the US president referred to as Liberation Day. "The impact on the Philippines economy from the trade deal is unlikely to be huge—the country is one of the least dependent economies in Asia on US final demand," Capital Economics senior Asia economist Gareth Leather said in a commentary. "The fact that it has had to settle for tariffs of 19%, suggests other countries still in negotiations with the US will have difficulty negotiating tariff rates much below 20%, which looks set to become the benchmark for the rest of the region (excluding China)," he added. Latest data available from the Philippine Statistics Authority (PSA) show that Philippine exports stood at $7.288 billion in May, with the United States accounting for $1.109 billion or 15.2%. Imports for the month were recorded at $10.578 billion, of which $647.34 million or 6.1% came from the US. According to Leather, the latest rate removes some downside risks facing the Philippines, as it remains close to what other countries in the region are likely to face, and that the country is not expected to see a loss of competitiveness against other countries in the region. Compared to others Based on Trump's recent announcements, the Philippines' 19% tariff compares with Japan's 15%, Indonesia's 19%, Vietnam's 20%, South Korea and Malaysia's 25%, China's 30%, Thailand and Cambodia's 36%, and Laos and Myanmar's 40%. "Unlike the deals that were announced with Vietnam and Indonesia, there was no mention of the Philippines being required to clamp down on rerouting from China. We suspect this is probably something that will be inserted into a final agreement, but it was notable that Trump sounded relatively relaxed about the relationship between the Philippines and China, noting 'your dealing with China wouldn't bother me at all,'" Leather said. Posting on his Truth Social media platform, Trump initially said the Philippines is going open market with the United States with zero tariffs, while the Philippines would pay a 19% tariff. However, President Ferdinand "Bongbong" Marcos Jr., who had a meeting with Trump before the 19% rate was announced, has since clarified that the zero tariffs on US products would only apply to certain markets such as automobiles. Exporters to bear brunt Leather's remarks were echoed by Rizal Commercial Banking Corp. (RCBC) chief economist Michael Ricafort, who said the adjustment does not come as a complete surprise as other economies in the Association of Southeast Asian Nations (ASEAN) regional bloc were also slapped with tariffs higher than those reported in April. "Limited drag on Philippine GDP, as the Philippine economy is less reliant on exports as a source of economic growth. Philippine merchandise exports are three to five times lower compared to major ASEAN countries on a yearly basis," he said in a separate commentary. "Philippine exports are not that huge compared to other ASEAN/Asian countries, so more limited adverse impact on the Philippines by the US reciprocal tariffs," he said in a separate commentary. Ricafort noted, however, that exporters would still bear the brunt of the impact, and that the Philippines could still be affected indirectly. "The biggest hit would still be on Philippine exporters with the 19% tariffs/tax (except for electronics; according to the leading Philippine negotiators), since the US is the Philippines' biggest export market, accounting for 17% of the total, thereby could slow down Philippine exports sales/demand that, in turn, could indirectly slow down the overall economy," he said. He added that the higher reciprocal tariffs and uncertainties could slow demand for exports to the US, slow down global investments, global trade, employment, and the overall world economy, dragging down Philippine growth. Philippine Exporters Confederation (PhilExport) president Sergio Ortiz-Luis Jr. earlier said a 17% or 20% tariff rate for the Philippines would still be okay "on face value," but this would also depend on rates being imposed on other countries. "Initially, we expected that when we were 17%, the manufacturers would move to the Philippines. Actually, they haven't moved yet… Even now, even at 17%, we have difficulty competing with Vietnam," he said. No relative advantage For Aris Dacanay, ASEAN economist of Hongkong and Shanghai Banking Corporation Ltd. (HSBC), the latest rate is in line with Indonesia and Vietnam, removing the relative advantage that the Philippines earlier stood to gain from a substantially lower tariff, which could have potentially led to manufacturers relocating to the country. "Without the relative advantage of a lower tariff rate, economic growth will face headwinds, and it will also be harder to attract FDI (Foreign Direct Investments) to the Philippines," he said in a separate report. "The Philippine economy gained only a minimal competitive advantage compared to its ASEAN peers during this period due to the strong peso and high inflation. A reciprocal tariff of 19% would erase this advantage and risks putting Philippine exports at a disadvantage in the US market," he added. Dacanay expects the Philippines to rely on its playbook of maintaining a "robust reform narrative" to attract investments and technologies, and push through with its ambitious infrastructure agenda, and liberalizing different sectors. The Philippine economic team last month slashed its economic growth targets for this year and the next three years, citing heightened global uncertainties including the implementation of reciprocal tariffs. The Development Budget Coordination Committee (DBCC) now targets economic growth to average between 5.5% to 6.5% this year, down from the previous target range of 6.0% to 8.0%. It also lowered its target range for 2026 to 2028 to 6.0% to 7.0% from the previous range of 6.0% to 8.0%. Moving forward, Philippine officials are expected to continue negotiating with the US in the hope of decreasing the tariff rate further. — VDV, GMA Integrated News
GMA Network
2 hours ago
- GMA Network
19% vs. 0%? Lawmakers question new PH-US tariff deal
President Ferdinand "Bongbong" Marcos Jr. meets with US President Donald Trump in the Oval Office at the White House in Washington, D.C., July 22, 2025. REUTERS/ Kent Nishimura Lawmakers on Wednesday raised concerns on the new Philippines-United States trade deal, which imposes a 19% tariff on Philippine products entering the US against zero tariffs for at least some American exports to the Philippines. 'We ask Malacañang to make public this new trade deal with the US so we can scrutinize its possible impact on the local economy. We are interested to know what US agricultural products, if any, will be covered by zero tariffs and how this may impact on our local farmers,' Senator Francis 'Kiko' Pangilinan said. The deal was announced by US President Donald Trump during President Ferdinand "Bongbong" Marcos Jr.'s visit to the White House early Wednesday Philippine time. The new agreement reduces the earlier announced tariff for the Philippines of 20% by one percent. Marcos, who called the deal a "significant achievement," stressed that not all US goods will enjoy zero tariffs. Other senators said the 19-0 disparity is too huge of a margin to be considered fair. '19% vs. 0% tariffs is definitely not the most fair deal between decades-old friends or allies like the United States and the Philippines. If I may add, it is the worst insult that a host can throw at his guest. It is time for us to look for other trade partners,' Senator Panfilo "Ping" Lacson said. 'Sobra ata tayong dehado. Akala ko ba 'little brown bro' ang turing sa atin ng mga Amerikano? Bakit tila lagi tayong naiisahan sa mga ganitong usapan? Sana ay gawing patas man lang kung tunay na kakampi ang tingin sa atin,' Senator JV Ejercito said. (We are too much at a disadvantage. I thought the Americans looked on us as their 'little brown bros'? Why does it seem we are always on the losing end in matters like this? They should at least make it even if they truly see us as an ally.) Senator Imee Marcos said the deal cannot be considered a win. 'I have yet to see the final agreement. However, a mere 1% reduction in tariff rates for Philippine goods while having zero tariffs for US goods certainly does not look like a win for the Philippines,' she said. Kabataan party-list Representative Renee Co, a lawyer, also said that flooding the country with American goods will not stir national development. 'The country is already deep in foreign debt, and now, we will be flooded with American goods because our President agreed to it. The government fails to strengthen our local industries because we just allow American goods to capture the lion's share of our market,' Co said. Senator Vicente "Tito" Sotto III gave the deal a good review. 'It carries direct benefits for our country,' he said. — BM, GMA Integrated News
GMA Network
3 hours ago
- GMA Network
Japan's PM Ishiba denies he has decided to quit
Japan's Prime Minister Shigeru Ishiba, President of the ruling Liberal Democratic Party (LDP), looks on after meeting with the party's executives at the LDP headquarters in Tokyo, Japan, July 23, 2025. REUTERS/ Kim Kyung-Hoon TOKYO — Japanese Prime Minister Shigeru Ishiba denied on Wednesday he had decided to quit after a source and media reports said he planned to announce his resignation to take responsibility for a bruising upper house election defeat. Asked about media reports that he had expressed his intention to step down as early as this month, the 68-year-old leader Ishiba told reporters at party headquarters on Wednesday: "I have never made such a facts reported in the media are completely unfounded." The reports came after Ishiba and Trump unveiled a trade deal on Tuesday that lowers tariffs on imports of Japanese autos and spares Tokyo from punishing new levies on other goods. Ishiba chose not to quit straight after the election to prevent political instability as the August 1 deadline for clinching the trade deal approached, a source close to the prime minister said, asking not to be identified because they are not authorized to talk to the media. Ishiba will announce his resignation next month, Japanese media reported earlier. His departure less than a year after taking office would trigger a succession battle within the ruling Liberal Democratic party as it contends with challenges from new political parties, particularly on the right, that are chipping away at its support. Among them is the "Japanese First" Sanseito far-right group which surged in Sunday's vote, growing its representation in the 248-seat upper house to 14 from one. The party has attracted voters with pledges to curb immigration, slash taxes, and provide financial relief to households squeezed by rising prices. Ishiba, a former defense minister who failed four times to win the party leadership, defeated hardline conservative Sanae Takaichi in his fifth attempt in a runoff last year. Whoever succeeds him as head of the LDP, which has ruled Japan for most of the post war period, would have to govern without a majority in either house of parliament following the government's lower house election defeat in October. Their immediate priority would be to secure support from enough opposition party lawmakers to win confirmation as prime minister. Any incoming leader is unlikely to call a general election straight away, in order to bolster the party's appeal before seeking a mandate from voters, the source said. — Reuters
