GOVERNMENT reforms promoting labor welfare and efforts to rehabilitate tourist destinations boosted the country’s bid to retain its trade privilege with the European Union (EU).
At the BusinessMirror Coffee Club Forum on Wednesday, EU Ambassador to the Philippines Franz Jessen confirmed the Philippines got a “positive” feedback from the EU delegation that reviewed its Generalized Scheme of Preferences Plus (GSP+) status. He attributed this to government efforts to promote labor rights and environmental conservation.
“I think the conclusion [of the past reviews] was quite clear that things are improving over time,” Jessen said.
“That is good. In the meetings that I attended, it did not come up directly, but clearly, the cleanup [of Boracay]—from an environmental point of view—was important,” he added. The GSP+ is a trade privilege that permits the entry of 6,274 Philippine products to EU economies at zero duty.
With this in place, exports can enter the European market at competitive prices. The country, in return, has to implement 27 international core conventions on labor welfare, human rights, good governance and environmental concern to keep its GSP+ status.
Jessen said the EU delegation that assessed the country’s compliance with its commitments appreciated government measures to improve labor conditions—particularly moves to raise basic pay and ban contractualization—and protect the environment.
Last year President Duterte issued Executive Order 51 that strictly prohibits all forms of labor contracting, as well as subcontracting. It also granted the labor chief the power to declare activities, which may be considered as contacting.
Further, all 17 wage boards augmented minimum-wage rates from P8.50 to P56 in different periods last year, including an increase of P25 in the daily pay of Metro Manila workers.
The government also rolled out a six-month rehabilitation of popular island resort Boracay. The tourist destination had to be shut down for six months for the government cleanup and for hotels and resorts to comply with environmental laws.
In January of last year Jessen said about P120 billion worth of exports benefitted from the GSP+—mostly in the food and farm sectors—in 2017.
This made the EU the country’s second top export market, following Japan and ahead of the United States and China. The largest receipt improvements with the trade benefit in place were recorded in textiles at 145 percent, leather at 77 percent, footwear at 74 percent, fish and marine products at 71 percent, and animal products at 64 percent.
Image credits: Roy Domingo