ACTIVITY 4 : TRADE AGREEMENTS ARE GOOD?

     Directions: With your group, evaluate if creating these international policies and

agreements (Activity 3) are really    good for the   Philippines or the world in general.

Is ASEAN Trade in Goods Agreement (ATIGA) good for the Philippine?

A lot of people said that policies are made to set limitations for the common good of the

entire organization. These may be through setting up effective international policies and

international agreements. International agreements are formal understandings or

commitments between two or more countries, either through an organization set up for that

specific purpose to achieve its own goals through relations with other countries like ASEAN

Trade in Goods Agreement (ATIGA) that were signed and implemented in 2010. ASEAN

Trade in Goods Agreement (ATIGA) aims to establish the region as a single market which

allows them to expand the trading opportunities that means to expand and enhance trade,

several Free Trade Agreements (FTA) granting preferential tariff rates were signed to allow

importers of member states to reduce their import costs. The member of the countries agreed

to place 99% zero duty on the products involved in the “inclusion list”. Moreover, the

policies set up and the agreements are for the goodness of the countries that are involved. 

As part of the ASEAN Trade in Goods Agreement (ATIGA) the Philippines is now

improving as the agreements and policies do benefit our country. The free flow of goods,

cutting transactions, the ASEAN free trade area have contributed and had made a great

impact on the Philippines’ economy especially when it comes to the rice and sugar products

being traded. Rice and sugar as the most protected sectors in the Philippines that estimates the

net protection rate on sugar indicate extremely high rates of protection which peaked at 158
percent in 2008. The net protection rate declined to 56 percent in 2011. The improvement in

output of the sugar using sectors attracts factor resource movements from the sugar milling

and the rest of the nonagricultural sector. The impact of the agreements affect each

household’s income and poverty has been somehow lifted. Though some of the sugar sectors

are suffering from the decline of the percentage this also gives rise to other sectors. Having

fewer tariffs of exporting products specifically in the sugar sectors towards the ASEAN

countries may be worrisome as our country do exports this kind of product. Nevertheless,

these agreements are good if the country is just merely importing products from the other

countries that are members of this agreement. 

Generally, the existence of policy aims to benefit the entire country however, it may be

brought some disadvantages to some countries like the Philippines. The limitations stated in

the agreement or the policy itself limits a country for some circumstance yet it is something

that cannot be void because the negligence will result in legal consequences. However, the

ASEAN Trade in Goods Agreement (ATIGA) brought advantages to the Philippines more

than its disadvantages. It may limit Philippine's production and operation but it is interesting

to note that the agreement benefited the country more. ASEAN Trade in Goods Agreement

(ATIGA) is good for the Philippines because the elimination of the tariffs results in product

price reduction that encourages higher market competition. It helps ASEAN countries'

products gain access to a regional market that incorporates many substantial advantages that

make the market stronger. In terms of the export and investment sectors will generate higher

potential in the long term. It also increases competitive advantage which allows the foreign to

be attracted in giving direct investments to the Philippines and expand the businesses in the

country. Besides, Ramon Lopez the trade secretary said “We are confident that this new

scheme will facilitate trade and improve the ease of doing business for Philippine companies,

especially for micro, small and medium enterprises [MSME]. With the ASEAN Wide Self-
Certification Scheme (AWSC), it will be easier for our MSMEs to maximize the use of

ATIGA and benefit substantially from the ASEAN Free Trade Agreement. This is especially

important in the current situation as this removes the step where companies must apply for a

Certificate of Origin with the BOC for each of their shipments”. Moreover, ASEAN Trade in

Goods Agreement (ATIGA) gives preferential access to major international markets since

Freight Transport Association (FTA) reduces tariffs making exports cheaper and companies

may also enjoy faster customs clearance on their exports due to efficient custom procedures.

The said agreement also provides trade and investment protection which eliminates unfair

trade and investment policies resulting in more benefit to domestic companies and it also

protects the important assets of the companies since ASEAN Trade in Goods Agreement

(ATIGA) enforces companies Intellectual Property (IP) rights. In conclusion, ASEAN Trade

in Goods Agreement (ATIGA) is good for the Philippines to establish economic growth,

social progress, cultural development, and cooperation among Southeast Asian Nations

including the Philippines. 

REFERENCES:

https://businessmirror.com.ph/2020/09/29/philippines-implements-new-scheme-to-facilitate-

trade-with-asean-nations/

https://www.bworldonline.com/maximizing-benefits-asean-free-trade-agreements/

https://www.portcalls.com/ph-inks-asean-protocols-amending-atiga-boosting-services-

sector/http://www.gii.ncr.vt.edu/docs/GII_WP2013-1.pdf

Group Members

Alvin Baterna

Jashmine Bation

Kate Angel Elleso

Shiela Mae Hernane

Precy Joy Trimidal