The Philippines at the World Trade Organization (WTO) has transmitted to the European Union its commitment to negotiate a free-trade agreement (FTA) in spite of policy differences with the economic bloc.
In a document obtained by the BusinessMirror, the Philippines emphasized the importance of the EU as a trading partner at its 14th trade policy review in the WTO. As such, the country is committed to resolve its issues with the economic bloc in order to forge an FTA.
“The Philippines remains committed to solidify our long-term economic relation with the EU through a permanent FTA mechanism and we stand ready to continue our dialogue in this regard,” the Philippine statement read.
In proving the EU’s contribution, the Philippines highlighted the benefits of the Generalised Scheme of Preferences Plus, the trade privilege allowing the country to export 6,274 products to Europe at zero duty. It reported exports to the EU from 2015 to 2018 improved by 22 percent through the GSP Plus, as it allowed the free entry of products, like coconut oil, preserved tuna, bicycles, pineapple products, fruit jams, and some garments and footwear.
“As a developmental tool, GSP Plus fosters income growth, supports employment creation, and ultimately contributes to countryside development and inclusive economic growth,” the Philippine statement added.
It said it values the importance given by the EU on the role of micro, small and medium enterprises (MSMEs) in achieving growth for all. On this matter, Manila relayed to Brussels its readiness to work together to advance this agenda in the WTO.
The relationship of the Philippines and the EU has not been smooth sailing since President Duterte assumed office in 2016, as the economic bloc is one of the government’s staunchest critics in its war on drugs campaign.
In its report last week, the European Commission lambasted Manila’s human-rights condition due to the state’s drug war and proposals to reimpose capital punishment. The EU also took note of the President’s decision to veto a bill seeking to end the practice of contractualization in the Philippines.
This was also mainly the reason the two parties have yet to return to the negotiating table for the formalization of an FTA. The EU is reportedly backing down from talks to negotiate a trade deal until the government has addressed the economic bloc’s policy concerns.
The Philippines is mandated to implement 27 core conventions on labor welfare, human rights, good governance and environmental protection for it to keep its preferential trading with the EU.
The Philippines is one of the largest beneficiaries of the GSP Plus, according to the EU report. In 2018, it shipped roughly €1.91 billion worth of goods to Europe through the trade privilege.
This represented over 25 percent of the country’s exports to the economic bloc amounting to €7.49 billion, the EU report showed.
Bangladesh and India are the top beneficiaries of the GSP Plus. They are followed by Vietnam, Indonesia, Pakistan, Cambodia, Myanmar, the Philippines, Sri Lanka and Mozambique, in that order.