MANILA, Philippines – New Department of Trade and Industry (DTI) Secretary Ramon Lopez has soothed fears that the Permanent Court of Arbitration (PCA) ruling in favor of the Philippines against China won’t negatively impact trade.
“We don’t see any impact offhand. Even prior to this decision, we’ve seen the trade ongoing, [both] imports and exports. We export a lot to China, it creates jobs also for us,” Lopez said in a chance interview on Thursday, July 14 on the sidelines of the 4th regional competitiveness summit.
China, the world’s second largest economy, is the Philippines' 4th largest commodity export market representing 9.63% of exports with a total of $6.393 billion in 2015, according to Philippine Statistics Authority (PSA) preliminary data as of June 2016.
Lopez said: “They export also to us, parang tuloy tuloy lang siya. Safe to say, wala kaming nakikitang impact [at] baka lumakas pa. (They export a lot to us, and it's continuous. It’s safe to say we haven’t noticed an impact, and maybe it will even get stronger.)
“Even in the past 3 years, while [ the case] was being taken up, we were seeing trade continuing,” he added.
Exports to China have fallen by 16.49% from January 2015 to April 2016 although the country’s exports as whole has declined in the past 14 months, falling by 7.34% during the same period.
China is also the Philippines' top commodity import market, according to PSA data, with a 17.59% share and total imports reaching %10.83 last year. From January 2015 to April 2016, imports from China has grown by 27.98%.
The ruling by the United Nations-backed tribunal that China's so-called 9-dash line in the West Philippine Sea (South China Sea) has no legal basis has raised increased geopolitical tension in the region.
China’s government and the Chinese media have attacked the ruling declaring it null and void and cannot form a basis in any further bilateral negotiations over the disputed territory.
Credit rating agency Moody’s has said that the tension is unlikely to affect either country’s credit rating while BSP governor Amda Tetangco Jr said that events in the US and Japan are more likely to affect Philippine markets. – Rappler.com