The European Union has removed tariffs on strategic Philippines exports.
In its plenary meeting Thursday, December 18, the European Parliament completed the process to grant the country’s request for inclusion in the European Union’s (EU) General System of Preferences Plus (GSP+).
It was reported on December 12 that the Philippines received a favorable endorsement from the European Parliament’s Committee on International Trade (INTA) for its zero duty export bid.
EU Ambassador to the Philippines Guy Ledoux lauded the development as it will bring tariffs to 0% for two-thirds of tariff lines, including strategic products the country is already exporting to the region.
“This will immediately translate into savings of tens of millions of euros per year in foregone customs duties,” Ledoux said.
The country’s inclusion in the EU’s GSP+ provides 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.
Attracting new industrial investments in sectors where relatively high tariffs are slashed to zero under GSP+ is the main benefit from this inclusion.
Included are established Philippine exports that are labor intensive such as pineapple juice (currently 28.5%); garments (currently 5%-9%); preserved fruits (currently 6%-9%); tuna (currently 20.5%); fruit, jams, and jellies (currently 20.5%); and footwear (currently 11.9%).
The GSP+ preferences cover over 6200 tariff lines.
Ledoux added that 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,” Ledoux added.
Ledoux also echoed the Department of Trade and Industry’s view that inclusion in EU’s GSP+ would mean more jobs for Filipinos, especially those in the rural areas.
The Philippines is already a beneficiary pf EU’s GSP. Total exports to the EU that were eligible under GSP in 2013 amounted to €1.69 billion ($2.06 billion*) or 33% of total exports to the EU.
Actual utilization was around 64% or €1.08 billion ($1.33 billion) but this figure is set to rise with the GSP+ inclusion.
Source: Rappler