What's Happening?
The European Chamber of Commerce of the Philippines (ECCP) has raised concerns about the potential impact on the Philippine agriculture and garment sectors if a free trade agreement (FTA) with the European Union (EU) is not concluded before the expiration
of the EU's Generalized Scheme of Preferences Plus (GSP+) in 2027. The ECCP's advocacy papers highlight the importance of the FTA in maintaining preferential access to the EU's market, which is crucial for sectors like agri-food, garments, and tuna. The Philippines currently benefits from zero tariffs on 6,274 products under the GSP+. The country is in ongoing negotiations with the EU to establish an FTA, with talks scheduled in Cebu. The ECCP emphasizes that failing to secure an FTA could lead to increased tariffs and reduced competitiveness for Philippine exports.
Why It's Important?
The expiration of the GSP+ without a subsequent FTA could have severe economic consequences for the Philippines, particularly in the agriculture and garment sectors. These industries rely heavily on preferential access to the EU market, and losing this advantage could result in significant export losses and reduced competitiveness. The potential tariff increases could also deter foreign investment and hinder the Philippines' integration into global supply chains. For the EU, securing an FTA with the Philippines would strengthen economic ties and promote sustainable growth. The outcome of these negotiations will have long-term implications for trade relations and economic development in the region.
What's Next?
The Philippines and the EU are set to continue FTA negotiations, with the next round of talks taking place in Cebu. Both parties aim to conclude the agreement before the GSP+ expires in 2027. The ECCP and its members are committed to supporting the negotiations to ensure a lasting partnership that secures economic growth. The successful conclusion of the FTA would safeguard the benefits of the GSP+ and expand trade opportunities, while a delay could risk billions in exports and a unique opportunity for economic advancement.
