The Philippines will strive for an ambitious, balanced, and comprehensive free trade agreement (FTA) with the European Union (EU) as the parties resume negotiations on the deal, said Trade Secretary Alfredo Pascual in a joint press conference with European Commission Executive Vice President and Trade Commissioner Valdis Dombrovskis in Brussels, Belgium on Monday.
The European Chamber of Commerce of the Philippines (ECCP) and the German Chamber of Commerce of the Philippines Inc. (GCCPI) welcomed the relaunch of the FTA talks, saying this signals the attractiveness of the Philippines as an investment site for EU companies.
Pascual said the Philippines will pursue economic ties and foster cooperation with the EU across emerging trade areas like critical raw materials, climate change, environmental sustainability, labor, and good governance.
Pascual said he expects to attract investments from the EU in key sectors such as infrastructure, digital technology, research, renewable energy, and green transition.
Pascual added the FTA will ensure mutual market access and diversify supply chains, offering more opportunities for professionals and service providers.
Dombrovskis said EU welcomed the “positive change of direction” taken by the new administration, while encouraging further progress on human and labor rights.
Free trade negotiations stalled in 2017 over EU concerns about the human rights record of then President Rodrigo Duterte.
A trade deal could increase trade by 6 billion euros, Dombrovskis said.
The ECCP in a statement said the urgency to conclude the FTA before the end of the current administration in 2028 is further emphasized, especially considering the impending expiration of the EU Generalized Scheme of Preferences Plus (GSP+) in 2027.
“The resumption of talks presents a crucial opportunity to enhance economic growth, deepen partnerships, promote sustainability, prosperity, and progress,” ECCP said.
GPCCI noted the insights from the German-Philippine business community regarding the critical role of the FTA. The AHK World Business Outlook Survey for Fall 2023 showed 70 percent of respondents acknowledged the FTA’s vital contribution to the success of their business operations.
“We are encouraged by the recent developments surrounding the resumption of the FTA (talks), particularly highlighted by President Marcos’s remarkably successful visit to Germany last week–a visit that included a business forum we had the honor of co-organizing,“ said GPCCI president Stefan Schmitz.
The EU is the Philippines’ fourth largest trade partner. Trade in goods was worth 18.4 billion euros in 2022 and 4.7 billion euros ( in services in 2021.
“Our approach (on the FTA) is guided by the Philippine Development Plan 2023-2028, directing us to advance purposive, assertive, and forward-looking FTAs,” said Pascual.
He said the FTA aims to provide enhanced market access for goods, services and investments, going beyond the benefits of the GSP+ offering zero tariffs on more than 6,000 tariff lines or 66 percent of all EU tariff lines. The GSP+ has benefitted communities in General Santos, Davao, Cebu, Laguna, Cavite, and Batangas and catalyzed foreign investment, particularly in electronics, agriculture, processed foods, apparel, craft goods, travel goods, and home appliances.
