Free trade talks with EU resume; $6.5-B hike in flow of goods seen

MANILA, Philippines — The Philippines and the European Union (EU) have announced the resumption of formal negotiations for a free trade agreement (FTA), which is seen to boost bilateral trade flows by as much as 6 billion euros ($6.53 billion) annually.

Trade Secretary Alfredo Pascual and European Commission executive vice president Valdis Dombrovskis, who is also trade commissioner, made the announcement in Brussels, Belgium, on Monday night.

“The conditions are right to take our trade relations to the next level. Trade between the EU and the Philippines is already strong and has been growing at an impressive pace over the past decade,” Dombrovskis said.

“But we can do more to realize the full potential of our trade relationship. After concluding an extensive joint stocktaking exercise at the end of last year, we are reassured that we share a commitment to strive for a state-of-the-art agreement, with sustainability at its core,” he added.

READ: EU and Philippines relaunch free trade talks

Merchandise trade between the Philippines and EU was worth over 18.4 billion euros (P1.2 trillion) in 2022, a number which Dombrovskis said could expand by 6 billion euros (P363.8 billion) yearly with an FTA.

Supply chains

He highlighted that the Philippines is an important producer of a number of critical raw materials such as nickel, copper and chromite, which are all vital for green transition.

“A deal with the Philippines will help us to strengthen our supply chains of these critical materials at a time when global supply chains are under increasing pressure,” he said.

READ: European firms want EU-PH free trade pact

Pascual said that an FTA with EU would not only expand the flow of goods, but also facilitate the exchange of services and investments.

“It aims to enhance commercial interactions between our business sectors, create valuable opportunities for our service providers, especially professionals, and establish reciprocal rules and standards. This endeavor is designed to catalyze inclusive growth and development, fostering prosperity for all involved,” he said.

The European Chamber of Commerce of the Philippines hailed the resumption of FTA talks as a “crucial opportunity to enhance economic growth, deepen partnerships, promote sustainability, prosperity and progress.”

“With the Philippines among the fastest-growing economies in the region and boasting a young and dynamic population, the potential for mutually beneficial collaboration between the EU and the Philippines is vast,” the group added.