Last Thursday night (PHL time), the European Parliament granted the Philippines' application for the Generalized Scheme of Preference Plus (GSP+), a trade tariff scheme for a 28-member bloc.
EU Ambassador Guy Ledoux said this will immediately translate into savings of tens of millions of euros per year in foregone customs duties.
The Philippines can now export 6,200 tariff lines, including processed fruit and foodstuffs, coconut oil, footwear, fish and textiles.
The latest development will make the Philippines more competitive in Europe, European Chamber of Commerce of the Philippines president Michael Raeuber told GMA New Online.
"We expect trade, particularly exports, to grow with beneficial effects for the Philippine economy," he said.
The Philippines already enjoys benefits from the EU's GSP, wherein 2,442 products out of 6,209 are subject to zero duty while the rest have lower tariffs.
In 2013, Philippine exports to the EU eligible under GSP were valued at 1.69 billion euros, or 33 percent of total exports to that area last year.
But with the inclusion in GSP+, the value of exports will further increase.
The country's agriculture and manufacturing sectors will definitely reap most out of the EU's decision, Management Association of the Philippines president Greg Navarro said in a separate text message.
"Most to benefit are our agricultural products that still have high tariff rates," he said.
"This should also spur more manufacturing locators to the Philippines as they could now avail of the GSP+ benefits," Navarro added.
The new industrial investments include established Filipino exports that are labour intensive such as pineapple juice (currently 28.5 percent); garments (currently 5 to 9 percent); preserved fruits (currently 6 to 9 percent); tuna (currently 20.5 percent); fruit jams and jellies (currently 20.5 percent) and footwear (currently 11.9 percent).
With the new privilege, Philippine Chamber of Commerce and Industry (PCCI) president Alfredo Yao said the country should now work on helping firms in non-tariff requirements, especially in the agriculture sector.
"There are some non-tariff issues we have to thresh out. Like in the agriculture side, the EU requires a lot of certifications but we don't have existing laboratories or facilities for that," he said.
Yao said the PCCI asked EU for a grant for that purpose, but the government should also do its part. "We can work on that, we can push for that."
Source: GMA News
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