30 Jan 2015
Philippines Confirmed as First ASEAN Nation to Gain EU GSP+ Status
Newly introduced European Union export regime approves 6,200 tariff-free product lines for Filipino businesses.
The Philippines has been designated as the first ASEAN country to qualify for the European Union's (EU) Generalised Scheme of Preferences Plus (GSP+). This sees the country now entitled to export some 6,200 products to the EU on a tariff-free basis, including processed fruit, coconut oil, footwear, fish and textiles. In total, the ruling – announced late last year – covers 66% of all product lines.
Currently, the EU is the Philippines' fourth largest trading partner and its fourth largest export market – accounting for 11.56% of total Philippine exports. In 2013, trade between the Philippines and the 28 EU Member States was valued at US$12.8 billion.
GSP+ represents the latest stage of the EU's Generalised Scheme of Preferences (GSP) – a trade preference scheme for developing countries that currently covers 6,274 tariff lines. Under the original GSP, the Philippines was able to export 2,442 products to the EU duty-free, while reduced tariffs were applied to a further 3,767 items. The previous GSP regime ended in December 2013.
The Philippine government is estimating that 200,000 new jobs – mainly in the agricultural and manufacturing sectors – will be created under the new arrangement, with many of them destined for the country's less well-off rural areas.
The move is a welcome boost for the Phillipines, with the recent Thomson Reuters/INSEAD Asia Business Sentiment Index finding that business sentiment in the country dropped from 83 to 67 in the final quarter of 2014 – the largest such decline in Asia.
Sunny Chau, Bangkok Office