THE resumption of formal negotiations on a free trade agreement between the European Union and the Philippines is expected to start in 2024 after the scoping discussions which will start in September 2023, according to Trade and Industry Secretary Alfredo E. Pascual.
“We’ll start with the scoping discussion that will start sometime in September and the target is to complete before the end of the year. So that the formal negotiation of the FTA could follow suit hopefully by the start of the new calendar year 2024,” Pascual told reporters on the sidelines of the official visit of Von der Leyen in Makati City.
Pascual illustrated how the Philippines can benefit from a free trade agreement with the EU.
“This FTA will result in investments because,” he cited as an example, if a manufacturing enterprise operating in Europe “can produce its products or their products here in the Philippines at a lower loss or lower production cost on export to Europe, which is enjoying preferential tariffs then that will be a a big boost to their profitability.”
A trade agreement, he added, “would normally be followed by investment companies that will make full use of the preferential trade arrangements.”
Meanwhile, Pascual also noted that once the Philippines attains upper middle income status by 2025, “What we want to happen of course is that all the preferential treatment we’re getting under [Generalised Scheme of Preferences] GSP plus will be carried over to the FTA so that there will be greater permanence of the preferential treatment that we’re getting now.”
The Philippines is among the beneficiaries of the EU GSP+ arrangement as it is a “special incentive arrangement for sustainable development and good governance, which reduces tariffs to 0 percent for broadly the same tariff lines as Standard GSP.”
According to the EU, this arrangement is granted to vulnerable low- and lower-middle income countries that implement 27 international conventions related to human rights, labor rights, protection of the environment, and good governance.
On top of the key industries that the Philippines is benefitting from—in the areas of agricultural products like coconut oil, tuna, bicycles, and some electrical devices including hair dryers and vacuum cleaners, among others — under the GSP plus, Pascual said that under the PH-EU FTA, the Trade department is looking at negotiating for more sectors.
“Definitely, we’ll negotiate for the sectors but this is a give and take unlike with GSP plus, it’s one way you know, we’re getting preferential trade concessions with an FTA we’ll get the tariff concessions but at the same time we have to give,” Pascual added.
On Monday, the EU and the Philippines announced their intention to explore the relaunch of negotiations for an ambitious, modern, and balanced free trade agreement (FTA)—with sustainability at its core, according to the EU website.
For her part, European Commission President Ursula Von der Leyen said, “The Philippines is a key partner for us in the Indo-Pacific region, and with the launch of this scoping process we are paving the way to taking our partnership to the next level. Together, we will realize the full potential of our relationship, creating new opportunities for our companies and consumers while also supporting the green transition and fostering a just economy.”
PHL-EU FTA negotiations resume in ‘24 after Sept ’23 scoping talks–DTI
Source: News Paper Radio
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