This study aims to evaluate the effects of the Trade Reform Program on the performance and competitiveness of the Philippine agricultural machinery industry. It also attempts to identify non-price factors that may impinge on the industry’s competitiveness and efficiency. Findings have revealed that the TRP has rationalized the protection structure of the industry and its subsectors between 1983-1988. While there have been significant improvements in allocative efficiency and competitiveness during 1983-1988, technical efficiency has presented an opposite scenario. To upgrade production technology and product designs, research and development endeavors should be supported. Lessons from our neighbor’s experience such as Thailand’s should also be learned.