MANILA, Philippines — Sen. Sherwin Gatchalian called for a Senate inquiry into the potential economic impact of the United States’ new 17 percent reciprocal tariff on Philippine exports, warning that the move could ripple through key sectors such as overseas Filipino workers (OFWs) and the business process outsourcing (BPO) industry.

While acknowledging that the Philippines enjoys relatively favorable treatment compared to other Asian economies, Gatchalian said the government must not be lulled into complacency.

“Despite the seemingly advantageous position of the Philippines compared to its ASEAN counterparts, we must identify the potential impact—particularly on OFWs and the BPO industry—as both are vulnerable to a global economic slowdown,” the senator said in Senate Resolution No. 1343.

Gatchalian also pointed to possible supply chain disruptions and the risk that manufacturers might relocate operations to avoid U.S. tariffs—an outcome that could weaken export competitiveness and employment prospects.

Preliminary data from the Philippine Statistics Authority shows the U.S. remained the Philippines’ top export market in 2024, with $12.12 billion in shipments, up 4.7% from $11.55 billion in 2023 and accounting for 16.6% of total exports.

In a separate briefing, Special Assistant to the President for Investment and Economic Affairs Secretary Frederick Go acknowledged that the 17 percent tariff, while comparatively low in the region, may still slightly dent the Philippine economy. NEDA estimates suggest a potential 0.1 percent decline in GDP over the next two years due to the tariff change.

“May konting effect po ito,” Go said, though he maintained the Philippines is still in a relatively “advantageous” position. 

“Malinaw na malinaw… medyo advantage po ang Pilipinas nang kaunti,” he said, citing higher tariff rates of up to 40% faced by other Asian nations.

Go confirmed that the government has reached out to the Office of the United States Trade Representative (USTR) to open discussions, but clarified that Manila is not appealing for a rollback. Rather, the aim is to pursue “constructive negotiations,” with an eye on a long-term goal of securing a free trade agreement.

“The best possible outcome is a free trade agreement,” he said, emphasizing that such a deal would eliminate tariffs on both sides and improve economic stability.