EU to decide Dec 18 on PH bid for zero duty export

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EU to decide Dec 18 on PH bid for zero duty export
If approved, the inclusion of the Philippines in the EU's GSP+ would generate hundreds of thousands of jobs, mostly in rural areas, says the Department of Trade and Industry

MANILA, Philippines – The Philippines is expected to clear the final hurdle of its bid for inclusion in the  European Union’s (EU) General System of Preferences Plus (GSP+), following the latest favorable endorsement of the European Parliament’s Committee on International Trade (INTA).

The European Commission (EC) formally accepted the GSP+ application of the Philippines In February, and favorably endorsed it to the Council of Ministers of the European Union (The Council) and the European Parliament (EP).

The Council had earlier issued a formal notice of “No Objection” to the proposal.  but the European Parliament requested for two months to review the  recommendation. Thus, the European Parliament must decide on the proposal not later than December 18, 2014.

The country’s inclusion in the EU’s GSP+ will allow exporters to enjoy zero tariff for 6,274 covered products.

If approved by the EU Parliament, the Philippines will be the only GSP+ beneficiary in the Association of Southeast Asian Nations (ASEAN). Currently, there are 13 countries granted by EU with GSP+ privileges.

A high-level Philippine delegation presented the country’s case to the INTA and the GSP Monitoring Group in a joint committee hearing at the EU Parliament in Strasbourg, France. 

The delegation was led by Trade Undersecretary Adrian Cristobal Jr, and included Agriculture Undersecretary Segfredo Serrano, Labor Undersecretary Rebecca Chato, and officials from the Philippine missions in Brussels and Geneva.

Cristobal presented GSP+’s importance to the country, citing the Philippines’ economic gains, good governance, and anti-corruption reforms. He added that GSP+ can create over 200,000 new jobs in the agriculture and manufacturing sectors in its early years of implementation.

“Most of these jobs will be in rural areas outside the major cities where they are needed the most,” Cristobal said.

The fisheries sector is also expected to benefit from GSP+, DA’s Serrano said, while DOLE’s Chato said that the country remains committed to the various conventions of the International Labor Organization (ILO).

To date, the Philippines is a beneficiary of the EU GSP where 2,442 products from the Philippines are exported to EU states at zero duty while 3,767 are subject to reduced tariffs.

Animal or vegetable fats and oils, prepared foodstuff, textiles and garments, footwear, headwear, umbrellas, and chemical products are among the product sectors that are most likely to benefit from the GSP+ scheme as well.

Cristobal also thanked the EU for its assistance to those affected by Super Typhoon Haiyan in 2013, and added that the approval of EU GSP+ for the country will really be a game changer.

“Hundreds of thousands of jobs in the countryside and in disaster-stricken areas will be created in the short- and medium-term. It complements our growth strategy as well as our rehabilitation efforts in areas hard hit by Haiyan last year,” Cristobal said.

Utilize EU-PH bilateral trade

The EU is the Philippines’ 4th largest trading partner in 2013, with total bilateral trade at $12.8 billion.

The union also is the 4th largest export market of the Philippines.

While the EU sees the country as a potential hub in the globalized supply chain in ASEAN as the economies integrate, trade and investments between the two countries are “not up to potential” yet.

Walter van Hattum, head of Economic and Trade, EU Delegation to the Philippines, made the assessment  during the Open Dialogue on EU Philippines Trade and Investment at the Asian Institute of Management on December 11.

“Trade is underutilized. We could easily double the amount. This is a good time to invest in the Philippines. The main driver of growth, [is] if the government [sustains] the economic reforms … would be the deciding favor on how much investors will invest,” said Hattum said.

EU Ambassador Guy Ledoux said that both the EU and the Philippines want to deepen their already strong commercial ties.

“We want to do so in a way that promotes sustainable growth, job creation, and helps reduce supports poverty,” Ledoux said.

The EU-Philippines bilateral trade in 2013 amounted to over €11 billion ($13.63 million*), which is likely to increase by another 20% this year.

Van Hattum also expressed optimism of the approval of the Philippine qualification  in the EU GSP+. Rappler.com

European Union flag image and container cargo on a crane image via Shutterstock


*$1 = €0.81

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