THE Department of Trade and Industry (DTI) is optimistic that the Philippines will retain its market access and trade incentives with the European Union (EU) despite the economic bloc’s recent resolution concerning the country’s human rights situation, a factor that may potentially affect their trading relationship.
Trade Secretary Ramon Lopez told reporters over the weekend they are “confident” the Philippines will not lose its special incentive trade arrangement or the Generalized System of Preferences Plus (GSP+) with the EU.
“We provide the data. And policies and programs that ensure there’s compliance with the protocols and rules of engagement,” Lopez said.
The GSP+ provides zero duties on 6,274 products or 66 percent of all EU tariff lines. Among the local products where tariffs are eliminated upon entering the EU are tuna, pineapple, bicycles, textiles and garments and footwear.
The DTI chief stressed that the Philippines has a dialogue mechanism with the EU to address issues and concerns that can impact their trading partnership.
Lopez said the country has been cooperating with the EU and addressing “repeatedly” such concerns via dialogue mechanisms.
In fact, he said, the country is compliant with the 27 international core conventions on human rights, labor, environment and good governance.
EU Parliament reso
Lopez made the statement after the EU warned that the Philippines may lose its trading privileges and market access with the economic bloc under the GSP+ if it will not address the human rights abuses.
The European Parliament asked “to set clear, public, time-bound benchmarks for the Philippines to comply with its human rights obligations” under the GSP+, according to its recent resolution.
“The allegations are not new, and the Philippine government has always responded and been giving submissions to facilitate the EU GSP plus monitoring to show the country’s compliance with the 27 international core conventions on human rights, labor, environment and good governance,” Lopez said.
In addition, Lopez said the allegations on “human rights and lack of press freedom are fake news, and those only give false impressions on the real situation in the Philippines.”
This, despite the issues surrounding the extrajudicial killings from the government’s “drug war,” and the red-tagging of activists and journalists, among others.
“It is unfortunate that the politicians of a huge economic bloc is the one destroying the image of small democratic country of peace-loving Filipinos, and it is like bullying a small country,” Lopez added.
The trade chief noted that the Philippines’s trading perks with the EU have helped local industries, especially the marginalized sectors.
“To date, the Philippines still enjoys EU GSP plus preferences, and this actually redounds to the benefit not only of the investors but the marginalized sectors of the economy, the fisherfolks, farmers, MSMEs [micro, small and medium enterprises], the workers in the value chain of the exporters, precisely fulfilling the objectives of the GSP plus, which is to help address poverty and inequality,” Lopez said.
“Our partnership becomes more relevant as we work towards post pandemic recovery. The EU GSP plus would be instrumental in encouraging investments in the country as well as sustaining job generation,” he added.
Assistant Secretary Allan B. Gepty, meanwhile, said that they are open to working with the economic bloc to address the matter.
Gepty added this was not “the first time that the European Parliament approved such kind of resolutions” as it raised the same concerns in 2016, 2017, 2018 and 2020.
In 2020, the GSP+ utilization rate rose to 75 percent—an all-time high—from 71.9 percent the year before. This represents €1.61 billion worth of exports to the EU that were granted such trading perks.
Total Philippine exports to the EU, however, slowed down to €6.2 billion in 2020 from €7.63 billion in 2019.
The Philippines has been enjoying GSP+ perks since 2014.