PH-EU free trade agreement to unlock $8.3-B in export potential

The Philippines is eyeing a significant boost in its trade relations with the European Union (EU) through the proposed Philippines-EU Free Trade Agreement (PH-EU FTA). Department of Trade and Industry (DTI) Undersecretary Allan Gepty highlighted that the country has $8.3 billion in untapped export opportunities within the EU market, which the free trade deal could help unlock. This potential was a focal point in the recent negotiations held in Brussels.

Gepty described the renewed discussions as positive and constructive, noting that both parties made substantial progress during the first round of formal negotiations. The talks focused on key elements and chapters of the agreement’s text. Following this initial phase, the second round of discussions is set for February 2025 in the Philippines, with subsequent rounds scheduled for June and October next year. Gepty expressed urgency to complete the deal as swiftly as possible, given the EU’s vital role as a trading partner.

The urgency stems from the potential exit of the Philippines from the EU’s Generalised Scheme of Preferences Plus (GSP ) program once it achieves upper-middle-income status.

Under GSP , around 26 to 28 percent of Philippine exports currently enjoy duty-free access to the EU. However, if the country attains and maintains upper-middle-income status for three consecutive years, it would no longer qualify for GSP benefits. Gepty emphasized the importance of finalizing the free trade deal to avoid a gap in preferential trade arrangements with the EU.

The PH-EU FTA aims to provide a comprehensive framework that not only covers goods but also services and investment opportunities, strengthening the economic ties between the Philippines and the EU. The government remains committed to advancing the agreement to ensure continued and expanded market access for Filipino exporters.