The European Chamber of Commerce of the Philippines (ECCP) called for the retention of the Generalised Scheme of Preference Plus (GSP+) granted by the European Union (EU) to the country, in the wake of the EU Parliament’s recommendation to withdraw the trade arrangement.
“The European Chamber of Commerce of the Philippines strongly calls for the retention of the GSP+ grant in the Philippines. Such a decision will result in massive social and economic repercussions to the Philippines, and will compromise the notable progress that the European Union and the Philippines have built over the years,” said ECCP president Nabil Francis.
Considering the EU is among the Philippines’ largest trading partner, Francis said removing the GSP+ will jeopardize jobs generated in both agriculture and manufacturing sectors.
Francis noted that Philippine exports to EU increased by 27 percent a year after the country qualified for GSP+, and revoking the benefits of GSP+ amid the Covid-19 pandemic “will also exacerbate the economic situation of the country,”
Under the EU GSP+ some 6,274 types of Philippine goods enter the EU market at zero tariff. In the 2018-2019 EU GSP+ report published earlier this year, the country’s utilization rate of the preferential trade arrangement is at 73.1 percent in 2018.
Earlier, the EU Delegation to the Philippines estimated too that around EUR 2 billion (P113 billion) or 25 percent of the country’s total exports to EU enter the trade bloc under GSP+.
Last week, EU lawmakers released a resolution calling on the EU Commission to initiate procedures to temporarily revoke the GSP+ status granted to the Philippines over the alleged “seriousness of the human rights violations” here.
The preferential trade arrangement provides that the Philippines must adhere to the 27 international conventions on human rights, labor rights, environmental protection, and good governance to continue enjoying the GSP+ benefits.
In an online media conference on August13 hosted by ECCP. Maurizio Cellini, head of Trade and Economic Affairs of the EU Delegation to the Philippines, said that the EU draws its “overall assessment on the basis of the whole picture” — looking at it in a global perspective and overall situation in the country.
Cellini’s comment refers to possible developments relative to the proposed restoration of the death penalty in the country, a human rights issue which was also flagged by the international community.
“GSP+ also depends on human rights issues, labor issues, environmental issues, good governance issues. We would like to look at the picture from a global angle,” he said, adding that the EU also considers the good development that sprout in these areas.
Meanwhile, a senior economist at Kuala Lumpur-based Juwai IQI Global said the Philippines can survive even if the EU decides to halt the GSP+ status grant.
“Juwai IQI Global chief economist Shan Saeed, in an e-mail message said: “The recent action of EU against Manila clearly indicates that EU has failed miserably in terms of economic outlook and wants to pursue myopic policies which are going to hurt European consumers more than Philippines consumers.”
“The Philippines can find new markets due to government efforts to maintain economic and growth outlook in positive mode despite the global macro-outlook that has become dubious,” he added.