General

20 votes in favor, one abstention, one against! The Senate of the Philippine Congress deliberated and formally approved the approval of the Regional Comprehensive Economic Partnership Agreement (RCEP) on February 21 - the final domestic procedure for the Philippines to join the world's largest free trade area has been completed. The Philippines will then submit the approval to the secretariat of the Association of Southeast Asian Nations, and the RCEP will officially enter into force for the Philippines 60 days after the submission of the approval.

On January 1, 2022, RCEP officially took effect. For more than a year, there have been many games in the Philippines around the progress of the agreement approval process. For many industries in the Philippines, RCEP is indeed crucial. It is understood that about 50% of the Philippines' exports and 68% of its imports come from RCEP member countries. Although it is a good thing, the upcoming implementation of RCEP in the Philippines will undoubtedly bring more new opportunities for trade and investment growth.

A representative of the Philippines said that in the context of the implementation of the RCEP, the real growth rate of the Philippines' gross domestic product (GDP) will increase by 0.9 percentage points and the poverty population will decrease by 5% by 2030. The implementation of RCEP can enable Philippine exporters and local enterprises to obtain cheaper raw materials and intermediate products; Small and medium-sized export enterprises in the Philippines, especially agricultural producers, will benefit from flexible certification procedures and enjoy more preferential trade arrangements. As a milestone of regional economic integration, RCEP will strengthen the international trade between the Philippines and other RCEP members and accelerate the economic recovery of the Philippines in the post-epidemic era.

Looking back on the economic development of the Philippines in recent years, we can see that it has benefited from close multilateral cooperation. As early as December 1979, the Philippines acceded to the General Agreement on Tariffs and Trade and was a founding member of the WTO when it was born. After integrating into the multilateral international trading system, the Philippines has vigorously developed the export processing industry and increased the economic restructuring, which has led to the development of transportation, communications, warehousing, finance and other industries, especially the development of the service industry. In recent years, the Philippines has made considerable achievements in bilateral and multilateral cooperation. For example, the China-ASEAN Free Trade Area Upgrading Agreement came into force in October 2019, and the regional economic integration of ASEAN has made breakthrough progress; On May 12, 2020, parts of the Free Trade Agreement and the Investment Agreement between Hong Kong, China and ASEAN involving the Philippines came into force; In October 2021, the Philippines and South Korea completed the negotiation of free trade agreement; Now RCEP is about to enter into force in the Philippines... The Philippines makes full use of multilateral and bilateral free trade agreements to deepen economic, trade and regional cooperation with countries.

Acenio Balisakan, Director of the Philippine National Economic and Development Bureau, said that joining the RCEP would help the Philippines integrate into the global supply chain, expand market access, and promote the sustained growth of the Philippine economy through regional and global trade and increase investment in strategic sectors.

Moreover, the cooperation between China and the Philippines in various fields has achieved fruitful results. China has become the largest trading partner of the Philippines for six consecutive years, and the bilateral trade volume far exceeds other major trading partners. Since the COVID-19, the bilateral international trade between China and the Philippines has maintained a good momentum. In 2022, the import and export volume of international trade between China and the Philippines will reach US $87.725 billion.

According to the Philippine World Daily, Philippine President Marcos said on February 17 that the agreement signed by his visit to seven countries had begun to be implemented. Since taking office as President, Marcos's seven-country trip has generated 166 programs worth US $62.926 billion. During this round of visit, Marcos brought back the largest amount of investment from China, amounting to US $24.239 billion.

Economic and trade cooperation is a microcosm of the close cooperation and interdependence between China and the Philippines. The people of the two countries are interlinked and cultural exchanges continue. For example, the China Research Center of New Era University of the Philippines launched on February 17 will greatly promote academic and cultural exchanges between the two countries and enhance mutual respect, mutual trust and mutual understanding. Cultural exchanges and economic and trade exchanges are also complementary.

The leader of the Philippine House of Representatives recently said that he hoped to promote Putonghua in schools at all levels in the Philippines to help improve the competitiveness of Filipinos in the international labor market. As good-neighborly and friendly countries, China and the Philippines need mutual respect and help to jointly create a better future.

Free trade is more frequent and more predictable in the future. China and the Philippines should make full use of the Free Trade Agreement, actively explore and deepen cooperation between China and the Philippines in various fields, effectively boost confidence in regional trade and investment at this stage, enhance the resilience and stability of the international industrial chain supply chain, and promote the long-term prosperity and development of the international trade region.