TC recommends zero tariff on EVs

Published July 6, 2022, 5:42 PM

by Bernie Cahiles-Magkilat

The Tariff Commission (TC) has recommended eliminating tariffs on electric vehicles (EVs), according to Trade and Industry Secretary Alfredo E. Pascual.

Pascual revealed the TC recommendation in a speech at the High-Level Dialogue on ASEAN-Italy Economic Relations attended by Italy’s Foreign Affaires and International Cooperation Minister Luigi Di Maio and ministers from ASEAN countries.

“Approval of this recommendation will put Italian e-vehicle makers on a level-playing field alongside our free trade agreement partners. We are opening our EV market to help develop an ecosystem for a viable market that can support the production of electric vehicles in the Philippines,” said Pascual.

It could be recalled that the TC conducted a public hearing on the proposal removal of the 30 percent most favored nation (MFN) tariff rate for EVs as mandated under the RA 11697 or the Electric Vehicle Industry Development Act (EVIDA).

The newly designated DTI Secretary pushed revealed that TC recommendation as he batted for ASEAN-Italy collaboration in the aerospace sector, energy, and smart technologies to build technologies and competence for the future for both partners.

On aerospace, Pascual said ASEAN and Italy may consider collaboration in aerospace parts manufacturing; aircraft maintenance, repair, and overhaul (MRO); and aerospace research and development.

He told the dialogue that the Philippines is building two massive airport complexes north of Manila: the Clark International Airport in Central Luzon and the New Manila International Airport in Bulacan. These developments have ample capacity to host MRO operations as well as manufacturing clusters.

The Philippines local aerospace industry already employs around 6,000 Filipinos. The sector has capabilities in tier-1 and tier-2 aerospace parts manufacturing, aircraft maintenance and repair, and training. The newly established Philippine Space Agency is also gearing up for space technology R&D, including using space data for disaster risk reduction and environment monitoring. “We can collaborate significantly on using remote sensing for agriculture and the environment,” he said.

On energy, Pascual said that the inclusion of energy in the June 2022 Practical Cooperation Areas for Italy and ASEAN is a vital first step toward collaboration. The current priorities of the ASEAN energy cooperation are to secure the region’s energy needs and create favorable conditions for ASEAN’s goals in clean energy development.

ASEAN could learn from Italy’s experience as it is Europe’s third largest in both in renewable power consumption, and electrical and thermal power production from renewable resources. The Philippines is also on the verge of massive adoption of renewables for energy security and looks forward to technical cooperation with Italy in digitally supported grids to deal with intermittent power.

With the Philippines ample green metal resources, Pascual said the country can supply mineral for the production of electric vehicles and battery production. “We have nickel, cobalt, and copper in abundance. The Philippines is also a dominant supplier of nickel ore, not only in Asia but in the world. It accounts for 31 percent of global exports,” he said.

Lastly, he said, both ASEAN and Italy can partner in smart technologies focusing on two factors, manufacturing and agriculture, to leapfrog to industrialization.

For instance, he said, the Philippines is focusing on three high tech strategic industry clusters – industrial, manufacturing and transport; technology, media, and telecommunication; and health and life science

With “Agriculture 4.0” taking root in Southeast Asia, Pascual said Italy and ASEAN should promote smart farming and agricultural technology that can contribute food security.