Europe-PH News

MANILA, Philippines —  The country’s utilization of the European Union (EU)’s trade preference scheme continued to increase, hitting its highest level last year.

Amid global uncertainty stemming from the United States’ tariffs on trade partners, the EU sees the need to accelerate talks for a free trade agreement (FTA) with the Philippines.

Speaking at the Makati Business Club’s general membership meeting last Tuesday, EU Ambassador Massimo Santoro said the Philippines’ utilization of the EU Generalized Scheme of Preferences Plus (GSP+) reached an all-time high of 80 percent in 2024.

He said the Philippines has been showing an upward trend in GSP+ utilization over the years, with the level of use at around 73 to 77 percent.

The EU GSP+ allows beneficiary countries like the Philippines to export 6,274 products to the bloc at zero tariff in exchange for implementing international conventions on human and labor rights, good governance and sustainable development.

Santoro is hoping that last year’s level of utilization will be sustained if not surpassed this year.

“We are very happy of course when the Philippine side makes the best use of this system of preferences,” Santoro said.

As the EU and the Philippines are in the process of negotiating a free trade deal, he said the goal is to expand the coverage of products that can enter the bloc at zero tariff.

“In light of this geo-political dimension… related to the tariffs, the FTA negotiations cannot but become more important and cannot but continue at an even higher pace,” he said.

According to Santoro, the willingness to accelerate negotiations would still depend on both parties.

“The key objective remains to achieve a final result that gives real added value to business on both sides,” he said.

The FTA being negotiated by the Philippines and the EU will include a chapter on digital trade, a component not present in other free trade deals of the bloc.

“Digital is something that gained in importance and speed most recently. So it is totally natural that it is not a chapter present in other FTAs because these FTAs were concluded before, in a moment where digital was not such a fundamental element,” he said.

There have been two rounds of FTA talks between the EU and the Philippines since negotiations resumed in October last year.

Prior to the resumption of talks, there were two rounds of FTA negotiations held in 2016 and 2017.

Santoro said the next round of FTA talks is scheduled to be held mid-June.

At present, the EU has FTAs with Southeast Asian countries such as Vietnam and Singapore, while talks are being conducted for similar deals with the Philippines, Thailand and Malaysia.