PH moves to expand trade with Europe

The Philippines is set to start technical discussions with the European Free Trade Association (EFTA) for a possible deal and lodge its application for qualification under the European Union’s new Generalized System of Preferences (GSP) scheme or GSP+.

Trade Undersecretary Adrian S. Cristobal Jr. said the country would submit by the end of this month its GSP+ application, which was seen to boost the Philippine exports to the European Union by as much as 611 million euros or P36 billion. Last year, Philippine exports to the EU under the existing GSP reached 1.076 billion euros (about P63 billion).

“We have requested the Department of Foreign Affairs to facilitate our request for signing authority, which will allow the secretary of trade to sign the country’s formal application for the European Union’s GSP+” Cristobal said.

The GSP+, which will take effect in January 2014, offers a more generous preferential scheme and a wider coverage of 6,274 products, which will all enjoy the preferential zero duty.

The zero duty will most likely benefit big ticket export products that the Philippines is currently exporting under the regular GSP. These are animal/vegetable fats and oils; prepared foodstuff; machinery and mechanical appliances; chemical products; textiles and garments, and plastic products.

In the meantime, the Department of Trade and Industry is planning to start the impact studies with the EFTA by early next year. The studies will be in preparation for talks on a possible free trade agreement between the Philippines and EFTA countries namely Iceland, Liechtenstein, Norway and Switzerland.

“We are aiming to start joint impact studies, but we have to do technical consultations with the EFTA first, represented by Switzerland. We are in the scoping stage now. That’s where we agree on certain broad principles (governing) tariff liberalization, trading goods, trading services and investments,” Cristobal explained.

Talks and negotiations for a free trade agreement with EFTA was jump-started by the visit of Swiss State Sec. for Economic Affairs Marie-Gabrielle Ineichen-Fleisch in June this year.

Fleisch was in the country to explore the possibilities to launch the negotiation process for an FTA.

She earlier said that an FTA was expected to “promote growth, create value and enhance the competitiveness for both partners.”

Enhancing the legal security for investors, she said earlier, would likewise increase the attractiveness of the partner countries as destinations for foreign direct investments.