Philippine-EU free trade deal timely as zero tariff regime on some goods to end—DTI chief

MANILA — Philippine Trade Secretary Cristina Roque called the substantial agreement on the Philippines- European Union (EU) Free Trade Agreement a historic milestone, which is also timely as the Generalized Scheme of Preferences Plus (GSP+) is about to end next year.

At the media briefing of the ASEAN Economic Ministers Meeting, Roque said the EU FTA will benefit Filipino businesses and more European investments can also go the Philippines.

“This historic agreement will open wider market access for Philippine products, attract high-value European investments, and create sustainable jobs for Filipino workers,” Roque said.

She added that specific products covered are still under negotiation. Maros Šefčovič, EU Commissioner for Trade and Economic Security, has earlier said that 94 percent of tariff lines will be liberalized, covering 97 percent of PH-EU trade.

This development also comes as the GSP+ is about to end in 2027. The Philippines enjoys zero tariff on about 6,000 products to the EU, the only Southeast Asian nation so far. The Philippines plans to expand this trade with the FTA.

Roque said, “For the GSP+, since we have already upgraded to upper-middle income, the GSP+ will not be binding anymore, so we really need the free trade agreement now to really make sure we transition from GSP+ to a free trade agreement.”

Philippine Trade Undersecretary Allan Gepty added that the EU FTA is timely as it comes at a time when the GSP+ deal will end and when the country became upper-middle income. Three consecutive years as upper-middle-income status forfeits the preferential trade for the Philippines. 

“Not just secure those preferential market access that we have been enjoying under the GSP+, but to really expand that further. In other words, we are targeting a higher percentage trade with the EU,” Gepty said.

He added, “There are many products that are already enjoying zero duty in the EU market, so if let’s say hindi na tayo mag qualify, then these products will be, of course, imposed with high tariff rates as high as 24 percent.”

Philippine President Ferdinand Marcos Jr. and European Commission President Ursula von der Leyen have announced that the Philippines and the European Union have reached a substantial conclusion of negotiations on a free trade agreement after several years of negotiations.

The signing of the EU FTA may happen next year, and it will have to undergo ratification by the Philippine Senate and the EU Parliament.