PH trade prospects brighten as US tariffs hit regional rivals

The Philippines is seen gaining ground in the global trade landscape as fresh US tariff hikes target several Asian economies—excluding Manila—positioning it to potentially outperform regional peers.

According to ING Asia-Pacific, the Philippines, along with Singapore and India, was notably absent from the latest round of tariff announcements issued by US President Donald Trump, offering a potential strategic advantage if trade negotiations proceed positively.

“President Trump’s new tariffs are higher than expected for most Asian economies. However, the announcements were silent on Singapore, India and the Philippines,” said Deepali Bhargava, ING’s regional head of research, in a commentary. “This could give these countries a competitive edge, especially if trade deals materialize.”

The US government reimposed a 17 percent tariff on various Asian exports on July 7, following a pause in implementation earlier this year. While most nations received notification of renewed tariffs, the Philippines has yet to receive such a notice, sparking speculation that it may be on track for a more favorable bilateral arrangement.

MUFG Bank also noted the absence of formal tariff letters to the Philippines, suggesting Manila may be part of a more favorable group being considered for trade concessions.

Last year, the US remained the top export destination for the Philippines, accounting for around 17% of total shipments, with electronics making up more than half. In May 2025, exports to the US grew by 3.6% year-on-year to $1.11 billion, while cumulative exports from January to May rose 9.1% to $5.38 billion.

The Department of Trade and Industry has confirmed that talks are underway to craft a “mutually beneficial framework” for a trade agreement with the US, amid the shifting tariff landscape.

DBS Bank estimates that Philippine exports to the US contribute around 2% to GDP, underscoring the potential impact of any improved trade access. ING’s Bhargava added that external trade likely made a stronger contribution to GDP growth in the second quarter, supported by a recovering trade balance and robust electronics demand.

However, Bhargava cautioned that subdued private investment and the pace of government spending could continue to weigh on economic performance.

For the rest of 2025, ING sees room for further monetary easing, expecting the Bangko Sentral ng Pilipinas (BSP) to cut rates by another 50 basis points to support growth.