The European Parliament on Thursday approved the grant of additional duty-free privilege to the Philippines under the Generalized Scheme of Preferences-plus (GSP+) program, European Union (EU) Ambassador to the Philippines Guy Ledoux announced.
“In its plenary meeting today, the European Parliament completed the last stage in the process to grant the Philippines GSP+ that will provide duty-free entry to the EU for some of the most important Philippine exports, including processed fruit and foodstuffs; coconut oil; footwear; fish and textiles. The GSP+ preferences cover over 6,200 tariff lines,” Ledoux said. “This is very good news for the Philippines as it will bring tariffs to zero percent for two-thirds of tariff lines, including strategic products that the Philippines is already exporting to the EU. This will immediately translate into savings of tens of millions of euros per year in foregone customs duties.”
Ledoux added: “Apart from giving a dramatic and immediate advantage to Philippine exports, the EU concession significantly improves the attractiveness of the Philippines as a destination for new agricultural and manufacturing facilities for products that will now enjoy duty-free access to the EU. This gives the Philippines a comparative advantage and represents very tangible EU support to the Philippine strategy to increase exports and investments, and diversify its industry. The bottom line is more jobs for Filipinos in the Philippines.”
The Philippines is already a beneficiary to EU’s GSP. Total exports to the EU that were eligible under GSP in 2013 amounted to €1.69 billion, or 33 percent of total exports to the EU. Actual utilization was around 64 percent, or €1.08 billion. But this figure is set to rise as a result of GSP+.
The greatest benefit that is likely to be gained from GSP+ is the attraction of new industrial investments in sectors where relatively high tariffs are being slashed to zero under GSP+. These include established Filipino exports that are labor intensive such as pineapple juice (currently 28.5 percent); garments (currently 5 percent to 9 percent); preserved fruits (currently 6 percent to 9 percent); tuna (currently 20.5 percent); fruit jams and jellies (currently 20.5 percent) and footwear (currently 11.9 percent).
The EU provides GSP+ preferences to create economic benefits that will help the Philippines to assume its responsibilities under core international conventions on human and labor rights, environmental protection and good governance. The EU, which is also a party to these conventions, will keep under review their effective implementation by the Philippines, as well as its cooperation with their monitoring bodies.