The Philippines and the European Union (EU) announced on Tuesday that they have agreed to start formal negotiations for a free-trade agreement (FTA), three years after laying down the foundation for it.
Outgoing Trade Secretary Gregory L. Domingo and EU Trade Commissioner Anna Cecilia Malmström said they “share the ambition” to conclude an FTA that covers a broad range of issues, including the elimination of customs duties and other barriers to trade, services and investment; access to public procurement markets; and protection of intellectual-property rights.
The prospective FTA would also include a comprehensive chapter that will ensure that closer economic relations between the Philippines and the EU go hand in hand with environmental protection and
“The EU is one of the country’s largest trading partners and investment sources. We would like to lock in the duty-free market access we obtained through the EU-Generalized System of Preferences Plus [GSP+]
last year, and expand this preferential access to substantially all the traded products to the EU,” Domingo said in a statement.
“As with our recent experience with GSP+, we are optimistic that investments will start to come in with improvements in market access” he added.
The Department of Trade and Industry said the first round of negotiations would take place in the first half of next year in the Philippines.
According to an earlier report by the BusinessMirror, a “compelling” factor that helped move negotiations forward is the Philippines’s progress on good governance, environmental compliance and trade liberalization.
The Philippines is one of the 10 members of Asean, as well as the fifth- largest economy in the region and the second-biggest market in Southeast Asia. It is also the fifth country of the Asean to start negotiations for a bilateral FTA with the EU.
The EU is the Philippines’s fourth-largest trading partner with bilateral trade amounting to P738 billion. The Philippines is the EU’s sixth-largest trading partner in Asean and 44th worldwide.
The Philippines’s main exports to the EU were office and telecommunication equipment (45 percent), machinery (15 percent), food products (12.5 percent), and optical and photographic instruments (11 percent). Philippines’s imports from the EU were transport equipment (31 percent), machinery (15 percent), food products (13 percent), chemicals (11.5 percent) and electronic components (11 percent).
The trade in services between the EU and the Philippines was worth P169 billion in 2013. The EU is also the largest foreign investor in the Philippines, with a foreign direct investment stock in the country of over P366 billion. –Catherine Pillas, Businessmirror