THE Philippines is preparing to offer sweeping trade concessions to the United States under a proposed bilateral pact that could reshape the country’s economy, according to a memorandum from the Department of Trade and Industry (DTI).
The document, issued just days before President Ferdinand Marcos Jr.’s visit to Washington, outlines the terms of the proposed Agreement on Reciprocal Trade (ART) Framework and carries the president’s explicit directive to align closely with US strategic and economic priorities.
“The Philippines needs the US; we cannot live without them,” Marcos was quoted as saying — a statement analysts warn reveals a starkly unbalanced negotiating stance.
Signed by Trade Secretary Ma. Cristina Roque, after a July 16, 2025 meeting, the memo details unprecedented tariff reductions and import commitments favoring American exports, while granting US firms special access to Philippine energy, infrastructure and mineral resources.
Major tariff cuts, mandated imports
Under the draft agreement, the Philippines will fully eliminate Most Favored Nation (MFN) tariffs on key US agricultural exports, including soybeans, wheat meslin, wheat starch and wheat gluten.
Tariffs on crude oil and wheat seed will be slashed from 7 percent to 3 percent, while the 15 percent duty on imported lead-acid batteries — crucial to the local manufacturing sector — will be removed entirely.
The country will also commit to importing 16,000 metric tons each of US soy and wheat annually, worth an estimated $17.2 million. Imports of US chicken leg quarters are set to increase by 15 percent each year.
Additional import obligations cover American dairy products, hardwood used in furniture production, and even firearm components — raising concern among Filipino industry groups over the erosion of domestic markets.
Energy and mining
The draft ART Framework grants US companies prioritized entry into the Philippines’ energy and resource sectors.
This includes fast-tracked approval for oil and gas exploration in the West Philippine Sea, permits for infrastructure projects, and “first rights” to construct a liquefied natural gas (LNG) reception and regasification complex in Subic Bay.
Of particular sensitivity is the provision offering the US preferential access to Philippine reserves of nickel, cobalt and copper — critical minerals used in electric vehicles, semiconductors, and renewable energy systems.
Critics say the move effectively surrenders control over strategic assets to foreign interests.
Skewed toward US
According to the DTI memo, the proposed deal aims to generate up to $500 billion in commercial benefits for US farmers, ranchers and corporations by 2028.
However, there is no comparable economic projection for the Philippines. The agreement’s only nod toward reciprocity is the formation of a High-Level Task Force to promote “complementary trade” — a gesture analysts say lacks concrete guarantees.
“There’s a clear asymmetry in this arrangement,” said Herman Tiu Laurel, president of the Manila-based, pro-Beijing think tank Asian Century Philippines Strategic Studies Institute (ACPSSI). “The benefits for the US are substantial and immediate, while the risks to Philippine industries are largely unmitigated.”
Tiu Laurel, along with industry leaders, is demanding full transparency and broader consultation before any binding commitments are made.
“The economic future of our country cannot be decided behind closed doors,” he said. “We must scrutinize whether this deal truly serves the national interest.”
Concerns are growing that the Marcos administration is rushing to finalize the agreement under pressure from the US, especially as the Trump administration pushes for stronger trade enforcement and supply chain control across the Indo-Pacific.
While negotiations are still ongoing, the DTI memo signals a clear intention by the Philippine government to cement the ART Framework into a permanent bilateral trade deal — one critics fear may lock the country into a structurally unequal partnership.
Marcos arrived in Washington, D.C. for his three-day official visit to the United States on Monday.
On top of his agenda is a meeting with Trump, the first for an Association of Southeast Asian Nations head of state since the latter’s return to office last January.
Marcos is expected to first and foremost tackle the 20 percent tariff to be imposed by the US government on goods coming from the Philippines effective Aug. 1. It is a 3-percentage point increase from the 17 percent tariff initially announced in April.
Philippine Ambassador to the United States Jose Manuel Romualdez, in a briefing, expressed optimism that there will be a “positive discussion” that will transpire between Marcos and his economic team and their American counterparts.
“For a relationship to be right, it needs to be right for both sides. So we have to always think on that basis now. It’s not just what we can get from a country. It needs to be right for both. But most importantly, it has to be what’s good for us. That’s part of the whole equation on why we’re embarking on this trip that the president takes,” Romualdez said.
Apart from his one-on-one with Trump, Marcos is also slated to meet separately with US Secretary of State Marco Rubio and Defense Secretary Pete Hegseth at the Pentagon.
He is also scheduled to sit down with different business leaders in health care, the semiconductor industry, and businesses already operating in the Philippines looking to expand their operations.
