1. Canada hopes to resume FTA talks with Philippines after APEC summit

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1 PHILEXPORT News and Features This Media Service is brought to you by the Philippine Exporters Confederation, Inc. (PHILEXPORT). Articles from PHILEXPORT News and Features may be reproduced without permission in accredited newspapers and magazines. The editors will appreciate receiving clippings of PHILEXPORT News and Features articles used. November 07, 2015 CONTENTS 1. Canada hopes to resume FTA talks with Philippines after APEC summit The government of Canada is keen to ink a free trade agreement (FTA) with the Philippines and hopes to continue bilateral discussions after the Asia-Pacific Economic Cooperation (APEC) Summit in Manila this November. 2. Furniture firms see 10% growth in 2016 Local furniture and furnishing makers see a 10-percent growth in revenues next year largely driven by continued strong demand expected from both local and export markets. 3. MICT, South Harbor to stay open on APEC week Two port operators in Manila announced they will be open and fully operational during the Asia-Pacific Economic Cooperation (APEC) Summit week to be held in the Philippines in mid-november. 4. Asia-Pacific countries urged to join global value chains to boost trade, investments More developing countries in Asia and the Pacific can seize opportunities of participation in global value chains (GVCs) to benefit from the expanded flows of trade and investments, and enable the Asia-Pacific region hold its position as the world s largest trading region. 5. Implementation of WTO Facilitation Agreement seen to increase trade, boost economy

2 Developing and least-developed countries can benefit from increased trade, economic expansion and investments through full and faster implementation of the World Trade Organization s Trade Facilitation Agreement (TFA). 6. Online payment system soon to be adopted in Manila port Companies or individuals who do business at the Manila International Container Terminal (MICT) can soon make all port-related payments online that aims to facilitate trade transactions. FULL STORIES 1. Canada hopes to resume FTA talks with Philippines after APEC summit The government of Canada is keen to ink a free trade agreement (FTA) with the Philippines and hopes to continue bilateral discussions after the Asia-Pacific Economic Cooperation (APEC) Summit in Manila this November. Neil Reeder, Canadian ambassador to the Philippines, said in his message at a briefing on exporting to Canada held recently in Makati that the two countries have already begun initial talks on an FTA. He added that if the deal pushes through, it would present a great opportunity for Filipino exporters to gain a bigger access to the Canadian market. The first round of exploratory discussions has been conducted earlier this year, but succeeding talks are now on hold as Canada held its general elections last month and just recently swore in its new prime minister, said Reeder. The ambassador said they are just waiting for guidance from the newly elected government before continuing with trade negotiations. He added that he is looking forward to a resumption of talks after the APEC Summit wraps up in mid-november. On May 8 this year, then Canadian Prime Minister Stephen Harper and Philippine President Benigno Aquino III announced the launch of exploratory discussions toward bilateral FTA negotiations. Philippine exports to Canada are currently growing at only a modest rate and could be bolstered should the two countries come to a trade pact. This is why both of our countries agreed to look at the chance of negotiating a trade agreement because once you eliminate tariffs and many other barriers behind the

3 borders, you ll see a significant increase in bilateral trade flows, Reeder had been quoted by Philippine media earlier. According to the Export Marketing Bureau (EMB) in a presentation during the briefing, Canada was the Philippines 14 th top export destination in 2014, with export value estimated at US$592 million for a 0.95% share of the market. The top five exports of the Philippines to the North America country last year were vehicle wiring sets, crude coconut oil, desiccated coconuts, men s and boys apparel, and digital integrated circuits, it added. Reeder said Canada currently has 12 FTAs in force, the most recent with South Korea. It has no free trade deal yet with any member of the Association of Southeast Asian Nations, and is looking at the Philippines as its first FTA partner in Southeast Asia. Steve Tipman, executive director of the Canadian government-funded Trade Facilitation Office Canada, who joined the briefing to give an update on buying trends in Canada, said there is much room for growth of Philippine exports. He said enjoying big consumer demand in his country are ethic agricultural products and halal foods; natural and organic health, cosmetics, and personal care products; niche and specialty goods; home décor and furniture; sports and recreational products and equipment; gardening products; and holiday-related items for Christmas, Halloween, Valentine s Day, and similar festivities. The Exporting to Canada briefing held late October is part of the Philippine Export Competitiveness Program of the Department of Trade and Industry s EMB, in partnership with the Export Development Council and the Philippine Exporters Confederation, Inc. (PHILEXPORT). 2. Furniture firms see 10% growth in 2016 Local furniture and furnishing makers see a 10-percent growth in revenues next year largely driven by continued strong demand expected from both local and export markets. The blooming domestic market for contract will continue to improve the performance of the furniture and furnishing sector, said Myrna Bituin, Philippine Exporters Confederation Inc. (PHILEXPORT) trustee for the furniture sector. Bituin expects continued growth despite problems hounding the sector, including higher trucking cost, inadequate services at the port as well as higher costs of power, labor and taxes.

4 (These) are affecting the growth of the sector compared to Indonesia, Vietnam who are our closest competitors, she said. As for the key export markets, Bituin said the United States (US), European Union (UE) and Middle East are picking up. The US market is recovering, buyers still prefer the Philippines provided the prices are acceptable. The EU and the Middle East markets continue to improve followed by Japan, a long time Philippine partner, she added. Bituin further said stringent requirements like the EU Timber Regulation (EUTR), US Lacey Act and the Australian bill are not yet fully implemented. 3. MICT, South Harbor to stay open on APEC week Two port operators in Manila announced they will be open and fully operational during the Asia-Pacific Economic Cooperation (APEC) Summit week to be held in the Philippines in mid-november. In response to queries from port users about their work schedule during APEC week, Asian Terminals Inc. (ATI) and International Container Terminal Services, Inc. (ICTSI) said they will continue to serve their clients during the APEC week of November 16 to November 20. The country is hosting the APEC Economic Leaders Meeting on November 18 to November 19 which will be attended by heads of state of the cooperation s member countries. Manila South Harbor operator ATI assured stakeholders that it will have normal operations, and that all trucks that will be entering the terminal will be serviced accordingly. ICTSI, which operates the Manila International Container Terminal, said MICT will remain fully open to serve all cargoes throughout the APEC week. Meanwhile, on the government side, the Philippine Ports Authority said two of its Manila port units will be in operation. The Operations and Finance personnel directly involved in port transactions shall continuously render the necessary port services. On the Bureau of Customs (BOC) part, it intends to deploy a lean staff during the APEC event. In a memorandum released in October, Customs Commissioner Alberto Lina directed BOC officials at the Port of Manila and Ninoy Aquino International Airport to maintain a skeletal workforce from November 17 to November 20 to avoid disruption [of] the work

5 process with the Bureau of Customs of our stakeholders, the private and public clientele. The government has already announced the suspension of work in public offices in the National Capital Region from November 17 to November 20. However, state providers of frontline and basic services will continue operating. For the private sector, work in the NCR is suspended on November 18 and November 19, while classes in all levels are suspended from November 17 to November Asia-Pacific countries urged to join global value chains to boost trade, investments More developing countries in Asia and the Pacific can seize opportunities of participation in global value chains (GVCs) to benefit from the expanded flows of trade and investments, and enable the Asia-Pacific region hold its position as the world s largest trading region. The latest United Nations Economic and Social Commission for Asia and the Pacific (ESCAP) regional trade and investment outlook report concluded that the Asia-Pacific region has been central to the development of GVCs and is now at the heart of many global and regional supply chains. Despite this, most countries in the region have not fully benefitted from the expanded flows of trade and investments associated with the rise of GVCs and remain excluded from their potential benefits, particularly low-income countries, it said. The UN report stressed that 90 percent of GVC-related trade flows are concentrated in just 10 regional economies including Australia, China, Japan, India, Indonesia, Malaysia, the Republic of Korea, Singapore, Thailand and Turkey. The Philippines is highly integrated into GVCs compared with the region overall, as reflected in the composition of top import and export products which are dominated by intermediate goods. These goods are classified as capital goods, but feature prominently as intermediate inputs in technology-oriented GVCs. To enhance GVC participation, the report discussed the importance of comprehensive trade liberalization, noting that relaxation of tariff is a critical step in competitively engaging in the value chains, both globally and regionally. A 1-percent increase in own tariff is linked with a 2 percent-5 percent decrease of GVCrelated export through GVCs, it said.

6 The UN pointed out that liberalization of trade in services and investment could enhance the competitiveness of manufacturing firms and facilitate their participation in global production networks. It said countries in Asia and the Pacific also needs to improve behind-the-border and border trade facilitation. In order for a firm to be able to better connect to GVCs, improvement of hard infrastructure, such as port connectivity, transport, logistics and the information communication network, is required. The accessibility and high quality of these physical infrastructure features are critical to helping firms minimize trade costs and thereby increase their opportunities for connecting with global production networks, the report noted. The UN report expects slowing growth in regional trade and investment flows even as Asia and the Pacific remains the most dynamic region of the global economy. The outlook for regional services trade was brighter than for merchandise trade. Exports of travel and other commercial services were especially strong, supported by growing demand for travel by China. 5. Implementation of WTO Facilitation Agreement seen to increase trade, boost economy Developing and least-developed countries can benefit from increased trade, economic expansion and investments through full and faster implementation of the World Trade Organization s Trade Facilitation Agreement (TFA). Developing countries capture a big share of the trade and GDP (gross domestic product) expansion, noted the recent WTO s flagship World Trade Report. Citing an economic model, the report estimated that exports of these countries can increase by as much as US$ 1.9 trillion, comprising more than 53 percent of the global trade expansion. LDCs are likely to see an increase in their exports of 36 percent, much more than developed or developing economies. The report cited data from the World Bank s Enterprise Survey covering nearly 130 developing countries which showed that implementation of the TFA will also increase the probability of small and medium enterprises (SMEs) exporting. Compared to large firms, SMEs will see a far greater rise in the share of their sales that go into the export market, it said.

7 The WTO report added developing countries will be able to diversify their exports, entering new markets and selling a wider array of products by implementing the TFA. Diversification reduces the risk posed to developing countries of a downturn in a specific export market or product, it said. If the TFA is fully implemented, it estimated that developing countries will increase the number of new products exported by as much as 20 percent and entering an additional 39 percent of foreign markets. Further, the UN report provided new evidence of the significant boost that the Agreement will provide by expanding world trade and reducing costs. The full implementation of the TFA has the potential to reduce trade costs by an average of 14.3 percent and increase global exports by between US$ 750 billion and US$ 1 trillion, depending on the speed and extent of implementation. The faster and more extensive the implementation, the greater the gains, it said. The same model result indicated that the TFA has the potential to add almost 0.9 percent annually to economic growth in developing countries compared to a quarter of a percent annually to economic growth in developed countries.. The report stressed that TFA will help developing countries attract more foreign direct investments (FDI). Companies making foreign investment decisions typically take the efficiency of trade procedures into account. Implementation of the TFA could be interpreted by foreign investors as a signal of improvement in the overall investment climate, which would induce inward FDI flows even in those sectors in the domestic economy that are not highly dependent on trade, it noted. But while the benefits of TFA are likely to far outweigh the cost of implementation, the report recognizes that implementation still poses a challenge to resource-strapped developing countries. The TFA itself provides a vital part of the solution, as its special and differential treatment provisions give developing countries ample scope for differentiated undertakings that depend on their level of capacity, it said. The report said the availability of international donor assistance helps governments in developing countries develop their capacity to implement the TFA and to shore up domestic support for implementation.

8 The TFA was agreed by WTO members at a ministerial conference in Bali in December It was the first multilateral agreement successfully negotiated at the WTO since its foundation two decades ago. 6. Online payment system soon to be adopted in Manila port Companies or individuals who do business at the Manila International Container Terminal (MICT) can soon make all port-related payments online that aims to facilitate trade transactions. The MICT is preparing to implement the second phase of the ACTS Billing System that allows customers to pay their port charges online. This will soon give you an option to transact remotely and to no longer require coming to the port, MICT told port users in an advisory. Launched last April, the billing system enhances the customer payment experience by cutting the procedure into five quick and easy steps. Self-service kiosks are provided at the billing lounge where processors can now lodge in all shipment details and get their queuing numbers. Once number is up, they simply go to teller to pay and get their receipts and gate passes. Apart from improved billing system, the MICT is also developing an enhanced version of the client dashboard which allows customers to have a complete real-time status on all their cargoes in a single-window view. Selected customers will be given access to a secured portal where they will be logging onto to retrieve these data. This will also allow you to generate statistics/reports that will show your KPIs (key performance indicators) to further assist you to improve your transactions at the terminal, it added. This month, MICT launched the mobile app device that features track and trace and customer support. This is available for download on both iphone and Android phones. Its features include MICT services and initiatives aimed to benefit port users including MICT billing calculator, vessel berthing schedule, export empty allocation, MICT EYES which provides live video streaming of port gates, and electronic platform terminal appointment booking system (TABS). The MICT is one of the three ports in the Port of Manila mainly handling international containerized cargo. It is today the Philippines largest international container terminal in terms of volume and capacity.