The Philippine government expects local exporters to start enjoying by the second half of 2014 the benefits arising from the European Union’s new Generalized System of Preferences (GSP) scheme or GSP+.
This was despite the slight delay in the submission of the country’s GSP+ application, which may take six to 10 months to be processed by the European Union, Trade Undersecretary Adrian S. Cristobal Jr. said in an interview with reporters last week. The application was scheduled for submission last month.
According to Cristobal, the Department of Trade and Industry is still awaiting the President’s go-ahead for the trade secretary to sign the country’s formal GSP+ application to the European Union.
“There is a slight delay. Sometimes these things take a little time. But the Department of Foreign Affairs has already endorsed (our request),” he added.
“But even with the slight delay, we’re still hoping that by the end of the first semester next year, we will be qualified (for the GSP+). But then again, it will take six to 10 months to evaluate each application, and there are several other countries applying for GSP+ privilege,” Cristobal said.
“We will do our best to fast-track this application. We are sending a team to Brussels sometime this month to take up several matters with the EU including the country’s application for the GSP+. Hopefully, we will be ready to submit our application by that time,” he added.
The Philippine delegation to Brussels will also continue discussions on possible free trade agreements with the EU and the European Free Trade Association (EFTA).
Cristobal, stressing the significance of qualifying for GSP+ privilege, said this would boost the country’s exports to the EU by as much as 611 million euros or about P36 billion.
Last year, Philippine exports to the EU under the existing GSP reached 1.076 billion euros (about P63 billion).
The GSP+, which will take effect by January 2014, offers a more generous preferential system and a wider product coverage, with a total of 6,274 products to enjoy zero duty.
The zero preferential duty will benefit mostly big ticket items that the Philippines is currently exporting under the regular GSP, including animal/vegetable fats and oils; prepared foodstuff; machinery and mechanical appliances; chemical products; textiles and garments, and plastic products.
Increased exports to the EU are also expected to translate to enhanced production capacity and generate about 270,000 jobs in both the agriculture and manufacturing sectors.