The Philippines expressed support to a proposal of the European Union Commission to extend the EU Generalized Scheme of Preferences (GSP) for an additional four years.
In a proposal dated July 4, the EC moved to issue a regulation that would extend the scheme when it expires at the end of the year.
“The current scheme is based on Regulation (EU) No 978/20123 and applies until 31 December 2023. Unless a new regulation replacing the existing Regulation is adopted prior to that date, the Standard GSP and the GSP+ arrangements will cease to apply from 1 January 2024,” the EC said.
Imports from developing countries under Standard GSP and GSP+ such as the Philippines would thus be charged with most-favored nation duties and the EC fears this could result to “significant economic shocks for companies in the EU and in beneficiary countries. “
DTI Secretary Alfredo Pascual was in Brussels last week as part of the Europe Investment Roadshow where hel met with key European Union (EU) officials to discuss the renewal of the EU GSP Scheme,
Pascual said the proposed extension comes at an opportune time and is expected to open a multitude of opportunities for the Philippines.
“With the extension of the GSP, it opens up tremendous opportunity for the Philippines to strengthen trade relations with the EU. We will seize this opportunity and work toward maximizing the benefits for our exporters and the overall economic development of our country,” Pascual said.
The GSP is a preferential trade arrangement that grants developing countries, including the Philippines, reduced or zero tariffs on exports to the EU market. With the proposed extension until December 2027, Philippine exporters can continue to benefit from enhanced market access and reduced trade barriers when exporting their products to EU member states.
The EC said: “This proposal is tabled with a view to ensure continuity and sufficient time for the legislative procedure necessary to prolong the application of the existing rules and avoid the negative consequences outlined above. The Commission is of the view that the new GSP Regulation should apply as soon as possible, at which point this temporary prolongation of the existing scheme should end. It is therefore proposed to maintain the current Regulation beyond 31 December 2023, with no changes, until the moment a successor Regulation is agreed among legislators and enters into force, after an appropriate transition period. “
