PH-EU FTA talks to restart in October

The national government is seeking to restart the negotiations for the Philippines-European Union (EU) free trade agreement (FTA) by October this year in order to ensure the preferential access of local products to the EU market.

“As far as moving forward is concerned, actually we’re eyeing to start the negotiation third quarter of this year. So, maybe around October. But June, we’ll have already our initial meetings at [the] chief negotiator’s level. So, at least, we can already discuss several things. The modalities of the negotiations, I mean, the arrangement, etc., in preparation for that,” said Department of Trade and Industry (DTI) Undersecretary Atty. Allan Gepty of the International Trade Group (ITG) in an ambush interview in Makati City on April 29.

The Philippine government and European Union (EU), represented by DTI Secretary Alfredo Pascual and European Commission (EC) Executive Vice President and Trade Commissioner Valdis Dombrovskis, respectively, announced the resumption of the talks on March 18.

Prior to that, a comprehensive stocktaking exercise by the DTI and EC was held September to December 2023 to lay the groundwork for the resumption of the negotiations.

The talks in October will be the third round of negotiations, clarified Gepty, since the first round was launched in 2015, and the second round in 2017, before the talks were halted due to the EU’s concerns on human rights violations under the then Duterte regime and intellectual property (IP).  

Gepty said that the Philippine negotiating committee had held consultations and trade policy dialogues with stakeholders, informing them of updates on the FTA, as recent as April 19.

He also shared that the negotiations will cover varying topics such as the possible easing of the EU’s rules of origin on garment exports through a waiver for Philippine garment firms, emphasizing that the Philippines intends to “negotiate for the most liberal rules of origin.”

The negotiation will also discuss the trade and sustainable development chapter, specifically pertaining to carbon emission requirements. Gepty said they anticipate dialogue on measures relating to environmental protection, etc.

“We have to really fast track the PH-EU FTA negotiations so that, in terms of trade, particularly exports, there will be no disruptions to our stakeholders or exporters because we want to maintain, at the very least, the same level of preferential arrangement,” he remarked, citing the current benefits enjoyed by the country through the EU Generalized System of Preference (GSP) Plus deal.

“While it has been extended up to December 2027, and we are waiting for the new GSP scheme, the fact remains that if the Philippines will reach the threshold of the upper middle income status, and you maintain that for three consecutive years, then, of course, you will no longer be qualified as a beneficiary of the EU GSP Plus,” Gepty explained.

The stability and predictability given to the Philippine business environment by the FTA will help attract more European investors to the country, he added.

In 2023, total trade from the EU was $16.16 billion, which makes up an 8.1 percent share in the country’s total trade, becoming the fifth largest trading partner of the Philippines. Foreign direct investments (FDIs) from the EU amounted to $63.99 billion in 2023.