The Department of Trade and Industry (DTI) in the Philippines has indicated that the entry into force of the Regional Comprehensive Economic Partnership (RCEP) Agreement is expected to attract more investments and trade opportunities to the country.
The RCEP, which took effect on June 2, 2023, is a free trade agreement involving nations accounting for 30% of global GDP and one-third of total inward foreign direct investments (FDIs) as of 2022.
DTI Secretary Fred Pascual emphasized during a press briefing that the Philippine government is committed to supporting local businesses in becoming more productive and competitive within the RCEP and globally.
“RCEP is a mega free trade deal that will also facilitate the influx of more investments in the country,” said Pascual.
In addition to attracting more investments, the RCEP will also enable advanced customs procedures for participating countries, allowing for a more streamlined trade within the region.
Exporters will only need to familiarize themselves with a single set of rules of origin (ROO) to access preferential market access, as opposed to dealing with multiple ROOs under existing trade agreements.
The RCEP also offers substantial benefits for Micro, Small, and Medium Enterprises (MSMEs). It allows them to integrate into global value chains (GVCs) through access to cheaper raw materials and a reduced barrier to entry for exporting due to a flexible certification process.
MSMEs not directly involved in exporting will also benefit, as they can easily provide goods and services to value-added firms engaged in GVCs.
As part of its efforts to increase awareness and utilization of RCEP and other Philippine trade agreements, the DTI is planning an intensified trade education and advocacy campaign this month, aimed at various sectors directly affected by the agreement.
Pascual underscored the significance of RCEP as a signal of the Philippines’ commitment to a rules-based trading system and an open, efficient, and resilient global trade.