By Justine Irish D. Tabile and Luisa Maria Jacinta C. Jocson, Reporters

DEPARTMENT of Trade and Industry (DTI) Secretary Ma. Cristina A. Roque on Thursday expressed confidence the Philippines will not be affected by reciprocal tariffs to be imposed by US President Donald J. Trump.

At the same time, the Philippines is seen to experience moderate spillover effects from US tariff policies, the DBS Bank report said.

Mr. Trump is planning to announce on April 2 reciprocal tariffs targeting countries that are responsible for much of the US trade deficit.

“For now, we do not have any information yet, so it is business as usual. But we feel that we will not be affected as we are allies,” Ms. Roque told reporters on Thursday.

“Our trade deficit with them is very minimal, so it is not something that we (should) worry about for now,” she added.

Data from the Tradeline Philippines showed that the total trade between the Philippines and the US reached $20.3 billion last year. The Philippine exports to the US hit $12.1 billion, while imports from the US reached $8.2 billion. This brought the US trade-in-goods balance — the difference between exports and imports — to a $3.9-billion deficit in 2024.

Ms. Roque said that she has already arranged a meeting with her US counterparts to discuss the planned reciprocal tariffs.

According to DBS’ vulnerability heatmap, the overall direct US tariff impact will have moderate spillover risks on the Philippines, as well as Singapore and Indonesia.

“Direct impact from US tariffs is likely to be limited, with Philippines’ contribution to value-add to US imports amongst the smallest versus ASEAN-6 (Association of Southeast Asian Nations) countries, and the size of the bilateral trade surplus (is) moderate versus peers,” according to a report authored by DBS senior economists Chua Han Teng and Radhika Rao.

On the other hand, Thailand, Vietnam and Malaysia are “relatively more vulnerable.”

The DBS report also estimated the potential impact of reciprocal tariffs on gross domestic product (GDP) of ASEAN-6 countries.

“The domestically oriented nature of Indonesia and Philippine economies shields them, limiting the spillover impact to less than 0.3 percentage point.”

In terms of direct impact on growth, DBS estimates the tariffs will only be a “negligible risk” to Philippine economic output.

“While the US is an important trade partner (accounting for 16.6% of the total), exposure to targeted sectors like pharma, and semiconductors, etc. is modest,” it said.

The US is the top destination for Philippine exports. Philippine exports to the US accounted for nearly 17% of total export sales in 2024, while imports from the US were only equivalent to 6.4% of total imports.

However, DBS noted the country’s value-added tax (VAT) rate of 12%, which “leaves the economy open to reciprocal action, albeit the scale is likely to be limited as the weighted average tariff rate on the US is small at 3.3%.”

For the ASEAN-6 region, DBS said economies “face higher direct and indirect risks from tariffs under the current administration.”

“Additionally, in the past six to seven years, the ASEAN-6 region has become more embedded in global supply chains, accompanied by a bigger share in global trade, whilst attracting strong investment interest.”

Mr. Trump’s sweeping tariffs are more “wide-ranging” than the first term, DBS said.

Meanwhile, DBS also flagged the sectors that could possibly be slapped with reciprocal tariffs.

For the Philippines, this includes transportation goods and animal products.

Moving forward, DBS said economies in the region are likely to seek bilateral discussion and concession agreements with the United States.

“A broad range of conciliatory options include diplomatic and other economic steps,” it said, citing bilateral trade agreements and critical mineral agreements.

“Secondly, the region might seek to step up purchases from the US, for instance agricultural inputs, machinery, aircrafts, energy and defense, to balance the trade gaps.”

DBS also called for greater collaboration within the region to soften the blow of tariff moves.

“ASEAN-6 has also maintained a close relationship intra-region, even amid increased foreign direct investment and trade linkages with China over the past decade.”

“Besides trade, strong trade co-operation is also supported by multilateral agreements such as the Regional Comprehensive Economic Partnership trade pact (RCEP) and a potential upgrade to the ASEAN Trade in Goods Agreement (ATIGA), with discussions underway.”

Meanwhile, S&P Global Ratings in a separate report said the Philippines will be less affected by US tariff policies compared with its Asia-Pacific neighbors.

“Australia, Indonesia, New Zealand and the Philippines should be less at risk of US tariffs, as they generally have low import tariffs, no major bilateral goods surplus with the US,” it said.

“As tariffs tend to be levied on goods, trade will be more resilient in economies where a substantial share of exports is of services. This is the case for the Philippines and, especially, India,” it said.

However, the credit rater still noted that the region will face indirect risks from the tariff conflict.

“Slower growth internationally as a result of trade friction and the associated uncertainty will weigh on exports. Also, Asian manufacturers will feel pressure from Chinese manufacturers, as Chinese producers seek alternatives to the US market,” S&P said.

“Despite these external strains, we generally project domestic demand momentum to remain solid, especially in most emerging-market economies. This is important, given the large role that domestic demand plays nowadays in most Asia-Pacific economies.”

S&P Global expects the Philippine economy to grow by 6% this year and 6.1% in 2026, both within the government’s 6-8% target band.

Meanwhile, Foreign Buyers Association of the Philippines (FOBAP) President Robert M. Young said that there may be a “big chance” that the Philippines will not be exempted from the reciprocal tariff due to its tariff rate differential with the US.

“But again, who knows? It’s difficult to read the mind of Trump. However, as I mentioned before, the Philippines should seriously and urgently (and no nonsense) develop and refocus the trade activities and engagement with the other economies,” he said in a Viber message.

“Lesson learned in relying on the US, which is a big mistake,” he added.