The paper analyzes the likely impacts of the APEC Early Voluntary Sectoral Liberalization (EVSL) program on the Philippine toy industry. The analysis shows that the industry failed to flourish and follow the technology-driven development path that made the toy industries of the country’s Asian neighbors captured the world market. Since the industry is not fully competitive yet, it would be beneficial for the industry to follow the tariff reduction schedule under the Tariff Reform Program instead of the EVSL proposal to bring down tariffs to zero beginning the year 2000. An exception to this, however, covers products where there are no local producers and hence, an early liberalization is proposed. Strategies and programs that would enhance the competitiveness of the industry to compete in a more open trading environment are also discussed.
