PHL may benefit from Trump tariffs–Oxford By Ma. Stella F. Arnaldo Special to the BusinessMirror
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LOW TIDE, HIGH HOPES Entalula Island in El Nido, Palawan—renowned globally as one of
the world’s top beach destinations—has seen fewer visitors recently compared to earlier this year. Still, with the Holy Week break under way, local tour agencies are optimistic about a renewed wave of tourists in the coming days. STEPHANIE TUMAMPOS
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HE Philippines may likely be insulated from the “Liberation Day” tariffs imposed by the United States due to its large domestic consumption base. In fact, it may even slightly benefit from the new tariff regime, as companies in Southeast Asia relocate to lower-levied economies. In its latest analysis, Oxford Economics said, “The relatively larger size of domestic spending in the Philippines buffers its economy against external volatility from an almost 20-percent export exposure to the US.” Although the new tariffs have been postponed,
under its initial announcement, Washington said it is imposing a 17-percent tariff on the Philippines, while most members of the Association of Southeast Asian Nations (Asean) were levied tariffs above the global 27-percent average. In the Asean, the two most likely to be severely impacted by the new tariffs are Vietnam and Cambodia, which were imposed the highest rates at 46 percent and 49 percent, respectively. These economies have the largest exposures to the US in terms of exports, and which account for a “significant share” of their respective local economic output as expressed in gross domestic product.
To soften the blow from the higher tariffs, some companies could shift their production from higher-tariffed locations to lower ones. “But not all businesses have diversified production bases and relocation costs are enormous. Also damaging is the hit from extreme trade policy uncertainty, which will lower business investment even if tariff hikes are eventually reduced or scrapped,” said Oxford Economics.
Low wage scale
THE economic advisory firm noted, if these tariffs are made permanent, the shifting of the production of goods in China to Asean “will accelerate given the
large tariff differentials.” A piece in the New York Times recently profiled a Chinese investor, Liu Gang, who started relocating his electronics factory in 2018 from southern China to an economic zone in Batangas, when President Donald J. Trump launched a trade attack on China during his first term. “At least half a dozen companies with customers in the United States have made inquiries in the last few weeks with Mr. Liu’s factory and his neighbors in one area of Batangas province that is a 90-minute drive south of Manila. Some have made commitments to shift production. It’s an unexpected turn of events See “PHL may,” A2
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BMI: ANOTHER 25-BPS RATE CUT LIKELY IN JUNE L
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By Reine Juvierre S. Alberto @reine_alberto
OCAL monetary authorities could lower the benchmark interest rate again by 25 basis points as early as June, according to BMI, a unit of Fitch Solutions. In a report published on Monday, the United Kingdom-based research firm said it maintains its forecast that the Bangko Sentral ng Pilipinas (BSP) will further lower the key policy rate by 50 basis points to 5 percent in 2025. “We are holding off from revising our projection until there is more clarity on how the United States’s protectionism policies will evolve,” BMI said. The Trump administration has put on hold its planned imposition of a 17-percent reciprocal tariff on the Philippines for 90 days, having slapped a 10-percent tariff rate on all countries instead. The BSP reduced the Target Reverse Repurchase (RRP) rate by 25 basis points to 5.50 percent on Thursday last week. The interest rates on the overnight deposit and lending facilities were also reduced to 5 percent and 6 percent, respectively. (See: https://businessmirror.com.ph/2025/04/11/bsp-lowers-key-rate-by-25-bpsmore-cuts-seen/). “In general, we’re looking at lower growth because of the uncertainty [and] volatility in the markets, as well as the prospective tariffs,” Remolona said in a televised interview. BMI said growth concerns “have risen to the fore,” as Trump’s tariffs have combined with the Philippine economy’s underperformance in the fourth quarter of 2024. The country’s gross domestic product (GDP) settled at 5.2 percent, below the government’s 6 to 8 percent target range. While the central banker said the tariffs will slow the Philippines’ economic growth, he said inflation is expected to be lower than the rest of the world. “The more manageable inflation outlook and the risks to growth allow for a shift toward a more accommodative monetary policy stance,” Remolona has said. BMI said with that inflation subdued, the BSP has the flexibility to lower key policy rates again, as signaled by Remolona. “Prompt policy support will be crucial for achieving the government’s 6.0 percent lower bound growth target,” BMI said. Should the 17-percent reciprocal tariff on Philippine exports be enacted, BMI said it will revise its policy rate forecast, penciling in more rate cuts.
REPENT, REUSE, REJOICE Artist Nikko Zorilla of the group Samahang Insiders applies finishing touches to a Passion of Christ installation made entirely of recycled materials at Poblacion, Makati. The creative depiction is part of the community’s Lenten observance, blending faith, sustainability, and artistry ahead of Holy Week. NONIE REYES
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SECURING A GREENER FUTURE National Home Mortgage Finance Corporation (NHMFC), Uanjelle Land, and Stagno Properties represented by former governor Faustino Dy Jr. sign a covenant enrolling the Cathedral Village Project at Gamu, Isabela in NHMFC’s BERDE Program which offers 3-percent interest for green-certified projects. The project, with a 70-percent open space, contracted the solar and microgrid systems of GBF New Power Group and safe water and sanitation access engaged by Water.org, allowing its 13,800 unit buyers to further enjoy additional benefits such as zero utility bills for five years. Projects under the BERDE Program are co-branded as Pambansang Pabahay Para sa Pilipinp (4PH) projects. (From left) Alduane Alegria of Uanjelle Land, Josephine Sarangaya, Maria Luisa Favila, Pres. Renato Tobias of NHMFC, Fmr. Gov. Faustino Dy, Jr., Samuel Yang of GBF New Power Group, and Mr. Anthony Dy of Stagno Properties.
ENTRAL bank services are now a one tap away from every Filipino’s fingertips as the Bangko Sentral ng Pilipinas (BSP) formally launched its mobile application on Monday. Through the BSP Mobile App, users can now easily access realtime financial data, policy decisions and economic indicators. Deputy Governor Bernadette Romulo-Puyat said launching the BSP Mobile App is an “important step” to bring the BSP closer to every Filipino. “This reflects our broader goal to equip Filipinos with the tools
and knowledge they need to make sound financial decisions. The launch is just the beginning. We will continue improving the app,” Romulo-Puyat said. As such, users can receive daily exchange rates through a push notification, which can be filtered to choose the currencies that matter most to them. The application also features a service locator to help users locate BSP regional offices and coin deposit machines. One of its standout features is “BSP Online Buddy” or “BOB,” a chatbot available 24/7 that alSee “Data,” A2
PHL sees modest export, GDP gains under new tariffs By Bless Aubrey Ogerio
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HE Philippines may see modest gains in exports and gross domestic product (GDP) under the United States’s new tariff structure, according to the country’s chief economist. Speaking at a press briefing on Monday, National Economic and Development Authority (Neda) Secretary Arsenio Balisacan on Monday said that the shift to a uniform tariff system, where countries are now subject to the same rate, offers “more favorable” net benefits for the Philippines compared to the previous setup of
reciprocal tariffs based on bilateral trade deficits. The Philippines, which initially faced a 17- percent tariff, now falls under a flat 10-percent rate. Neda simulations showed that this change could raise the country’s exports by around 1.5 percent, particularly due to stronger competitiveness not just in the US but in other markets as well. “Our exports would have grown stronger under this last iteration of the tariff regime…It’s an increase of our Philippine exports, not just in the US, but in other countries,” Balisacan said. However, with exports comprising a relatively small share of See “PHL sees,” A2
PESO EXCHANGE RATES n US 57.0850 n JAPAN 0.3964 n UK 74.7585 n HK 7.3626 n CHINA 7.8278 n SINGAPORE 43.2790 n AUSTRALIA 35.9636 n EU 64.6316 n KOREA 0.0402 n SAUDI ARABIA 15.2113 Source: BSP (April 14, 2025)