The Philippines is studying the prospect of a free trade agreement (FTA) with Paraguay as it looks to bolster market access for key domestic products abroad, according to the Department of Trade and Industry (DTI).

Trade Secretary Cristina Roque told reporters that a potential FTA with the South American country was proposed by Paraguay President Santiago Peña Palacios during his state visit to the Philippines last week.

“He opened the topic of the FTA between Paraguay and the Philippines,” Roque said on Wednesday, May 20, on the sidelines of the 47th National Conference of Employers.

Roque noted that the proposal is currently being reviewed by the DTI's trade policy team, led by Trade Undersecretary Allan Gepty, the country’s chief negotiator for FTAs, to assess the potential benefits for local exporters.

Asked if the Philippines is keen on the proposal, Roque said the government is always supportive of trade pacts as long as they are mutually beneficial.

“We're open to that because our President is pro-free trade agreement,” she said.

Paraguay is pushing for the FTA as it looks to unlock a new market for agricultural commodities such as beef, pork, and chicken. Meanwhile, the Philippines is eager to establish the South American nation as an export destination for its local fishing sector, targeting strong-demand commodities like tuna, sardines, and milkfish.

“Even if their population is small, which is 6.5 million, [Paraguay] wants to be the hub to the South American market,” Roque added.

A potential FTA with Paraguay would mark the Philippines’ second trade pact in South America. Negotiations for a Comprehensive Economic Partnership Agreement (CEPA) with Chile are expected to conclude soon, with Roque noting that the signing remains on track for this year.

The DTI chief also expects negotiations for a preferential trade agreement (PTA) between the Philippines and India to conclude this year, with bilateral talks already underway. Unlike an FTA, which covers a wide range of sectors, a PTA focuses solely on reducing trade barriers for specific goods and services. For its part, the Philippine government is particularly intent on leveraging the PTA to ease trade barriers on pharmaceutical products from India.

Additionally, the Philippines is expected to conclude FTA talks with Canada and the European Union (EU) this year.

These pacts are anticipated to boost the presence of Philippine goods in overseas markets at a time when the country’s exports have sustained their growth momentum, despite ongoing geopolitical tensions.

Data from the Philippine Statistics Authority (PSA) showed that merchandise exports rose 12.7 percent to $22.70 billion from January to March, up from $20.14 billion during the same period last year.