Senator Sherwin Gatchalian has sought an investigation into the implications of a 17-percent reciprocal tariff imposed on the Philippines by the United States, the country’s largest export market.

Gatchalian said it is important for the government to ascertain the potential impact of the U.S.’ imposition of a 17 reciprocal tariff on the Philippines, despite the superfically advantageous position of the country compared to its Asian neighbors that is also reeling from President Donald Trump’s sweeping U.S. tariff overhaul.

The lawmaker pointed out this latest policy by the Trump administration may have a negative impact on overseas Filipino workers (OFWs) and the business process outsourcing (BPO) sector amid global economic uncertainties.

“Despite the seemingly advantageous position of the Philippines compared to its ASEAN counterparts following the imposition by the United States of higher reciprocal tariffs, we must identify the potential impact particularly on OFWS and the BPO industry as both are vulnerable to a global economic slowdown,” Gatchalian said in filing Senate Resolution No. 1343. 

“There is (also) a need to determine how the Philippines could be affected by possible supply chain disruptions and potential departure of manufacturers who want to avoid tariffs,” the Senate Committee on Ways and Means chairman said.

Based on preliminary data from the Philippine Statistics Authority (PSA), the Philippines exported a total of $12.12 billion worth of goods to the US in 2024, accounting for 16.6 percent of Manila’s total exports last year and representing a 4.7 percent increase from the $11.55 billion worth of export products to the US in 2023. 

In a recent press briefing, the Department of Agriculture (DA) said the imposition of the tariff may give Philippine agricultural products an edge over neighboring countries’ exports to the U.S. market, as the Philippines has been imposed the second lowest tariff in the ASEAN region, next to Singapore at 10 percent. 

The Department of Trade and Industry (DTI) also said the Philippines is in a better position compared to other ASEAN member-states and Asian nations in view of the relatively lower tariffs imposed by the US. 

But the Foreign Buyers Association of the Philippines (FOBAP) noted that the end result of the new reciprocal tariff is that "the Philippines will have difficulties in getting export orders due to lesser or no demand,” Gatchalian noted. FOBAP pointed out that "the Philippines was selling at a higher price than Vietnam, India, and Cambodia” despite relatively lower tariffs, “meaning, Philippine goods wil be the last to be picked up from the shelves.”

The UN Trade and Development (UNCTAD) has also warned that as major economies impose sweeping new tariffs, "the global trade system is entering a critical phase - threatening growth, investment, and development progress, particularly for the most vulnerable economies.”

“Therefore, ... the appropriate Senate committee (should) conduct an inquiry in aid of legislation, on the potential impact of higher reciprocal tariffs imposed by the US, with an end view of crafting a legislation or policy recommendation, as may be necessary,” Gatchalian said in the resolution.