PH Could Gain from US Tariff Shift — But Infrastructure Gaps Hold It Back, Study Finds

The Philippines is in a favorable position to benefit from the latest U.S. tariff overhaul, according to a new study by the Philippine Institute for Development Studies (PIDS). Among Southeast Asian economies, the country faces the lowest average U.S. tariff rate of 17%, offering it a relative edge in attracting trade and investment.

The study introduced a Tariff Exposure Composite Index to evaluate how vulnerable countries are to the new U.S. duties. The Philippines and Indonesia both scored 2.2 — classified as moderate risk — though the Philippines fares better due to broader exemptions and more resilient export sectors.

Roughly 33% of Philippine exports to the U.S. enjoy exemptions, especially in high-value areas such as semiconductors, memory chips, and storage devices. In contrast, Indonesia, despite the same risk score, is hit with a higher 32% tariff and has exemptions covering only 10% of its exports.

Vietnam and Thailand, with U.S. tariff rates of 46% and 36% respectively, are far more exposed and heavily dependent on the U.S. market, the study noted. Vietnam, in particular, is the most vulnerable, sending 35% of its exports to the U.S.

However, the study warned that the Philippines may miss out on these potential gains unless it addresses structural constraints, such as weak infrastructure, limited manufacturing scale, and sluggish investment facilitation.

“The Philippines is strategically positioned to benefit,” said former Trade Undersecretary Rafaelita Aldaba, the study’s author. “But turning this into actual growth will depend on how quickly the country can ramp up logistics, attract investors, and promote exports.”

Malaysia, with a 24% tariff and the highest exemption coverage (46%), scored 2.8 on the index, ranking just behind the Philippines in opportunity.