Philippines and Chile, separated by thousands of miles, have started to strengthen economic relations with the signing of a memorandum of understanding for the establishment of a Joint Economic Cooperation (JEC) and to help each other’s membership bids in other regional free trade deals. 

Under the MOU, Philippines and Chile agreed to convene the 1st Philippines-Chile JEC within the year to sustain the momentum of bilateral discussions. The South American country is more than 10,000 miles away from the Philippines, a Southeast Asian country.

The signing of the MOU was also a significant milestone for both economies as it represents the first trade and investment mechanism of the Philippines to formally engage the South American Region.  

Trade and Industry Undersecretary Ceferino S. Rodolfo and Vice Minister for Trade of the Ministry of Foreign Affairs of the Republic of Chile Rodrigo Yáñez virtually signed the Memorandum of Understanding (MOU) for the Establishment of a Joint Economic Cooperation (JEC) between the two countries.  

Trade and Industry Undersecretary Ceferino S. Rodolfo and Vice Minister for Trade of the Ministry of Foreign Affairs of the Republic of Chile Rodrigo Yáñez virtually signed the Memorandum of Understanding (MOU) for the Establishment of a Joint Economic Cooperation (JEC) between the two countries.

Both officials emphasized that the signing is a valuable achievement in strengthening its bilateral relations, as this year marks the 75th anniversary of Philippines and Chile’s diplomatic relations. 

Rodolfo thanked Chile for the cooperation and support they have extended in finalizing the MOU and conveyed his hope “for a stronger and more dynamic engagement with Chile through the JEC complemented by existing mechanisms in ASEAN, APEC, and the WTO.”  

“The JEC will serve as a confidence building measure to further intensify the bilateral economic linkages while addressing the  challenges posed by geographic distance and generally low-level of awareness by businesses in each other’s markets,” said Rodolfo. He also added that the JEC will be a “tool for engagement on enhancing current levels of trade and investments, discussing various cooperation initiatives in areas of mutual interest, and promoting better synergies with businesses.”  

For his part, Vice Minister Yáñez underscored in his remarks that international trade is key to economic recovery and emphasized that, “It is of the utmost importance for our countries to define practical steps to foster open trade, enhance global value chains and support innovation and technology.”

He further conveyed Chile’s commitment to ”build on the historic and friendly relations and begin a new stage of active collaboration towards achieving a mutually beneficial relationship with the Philippines.”  

With the MOU, both countries sought to help each in pushing for their membership in other FTAs.

For instance, the Philippines has request its interest to join the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) where Chile is already a current member.

DTI Secretary Ramon Lopez has formally written to New Zealand, the  depositary country of the agreement inquiring on the process of accession to the CPTPP.

Vice-Minister Yáñez has conveyed Chile’s support for the Philippines’ accession to the CPTPP and shared that Chile is currently in the process of ratifying the agreement through its legislative body. He said that their technical team will be available to guide and assist the Philippines in the process.  

The Philippines will also helped in Chile’s bid to accede to the ASEAN-Australia-New Zealand Free Trade Agreement (AANZFTA).  

Following the receipt of an official letter from Chile’s Foreign Minister Andrés Allamand, Undersecretary Rodolfo conveyed Secretary Lopez’s directive to support Chile’s accession to AANZFTA.  

Also in attendance during the signing were Chilean Ambassador to the Philippines Claudio Rojas, Philippine Ambassador to Chile Teresita Daza, and representatives from the Department of Trade and Industry and Department of Foreign Affairs of the Philippines, and the Ministry of Foreign Affairs of Chile.

In his remarks, Ambassador Rojas highlighted the complementary nature of the Philippines’ and Chile’s bilateral relationship that comes with a fruitful space for growth and diversification of linkages between the two countries. 

He stressed the importance of the newly established JEC “to address and to tackle the overall assessment of economic and trade issues in the areas of trade facilitation, trade promotion, and investment, and could produce a profound impact in the overall relationship between Chile and the Philippines.”  

Meanwhile, Ambassador Daza emphasized in her remarks that notwithstanding the two countries’ cordial and growing relations, there is substantial scope and opportunities to strengthen economic ties. She underscored that “The JEC is thus significant as both sides will explore ways to promote trade and economic cooperation through the exchange of information in economic issues and concerns, the identification of sectors where cooperation can be intensified, and the recognition of measures for trade and investment expansion and diversification, among others.” 

Furthermore, she added that “This initiative comes at a time when our countries are facing serious challenges across different fronts and with varying intensities because of, and exacerbated by, the Covid pandemic that is far from over.”   

In 2020, Chile was the Philippines’ 54th major trading partner (out of 224), 52nd export market (out of 211), and 52nd import supplier (out of 205). Total bilateral trade between the two countries was valued at $59.71 million in the same year.  

Chile reported of $8.428 million worth of net outflows of foreign direct investment in 2019 primarily in the sectors of services, finance and insurance, and electricity and gas. However, from 2010–2020, there were no approved investments from Chile to the Philippines.


Source: Manila Bulletin (https://mb.com.ph/2021/04/28/ph-chile-sign-mou-to-push-bilateral-trade/?utm_source=rss&utm_medium=rss&utm_campaign=ph-chile-sign-mou-to-push-bilateral-trade)