EU-Philippines free trade deal eyed before GSP+ scheme expires in 2027

The European Union (EU) and the Philippines are aiming to forge a free trade agreement (FTA) by the end of 2027, in time with the expiration of a trading scheme which allows duty-free entry of over 6,000 products to the bloc from the country.

At the sidelines of the European-Philippines Business Dialogue in Makati City on Thursday, EU Delegation to the Philippines Ambassador Massimo Santoro said that both parties are moving positively with the FTA discussions as the negotiations are now entering its fourth round next week.

Santoro said the fourth round of FTA talks will be held in Cebu City, in show of solidarity with the province which was devastated by a magnitude-6.9 earthquake.

In March 2024, the EU and the Philippines announced the resumption of negotiations for the FTA.

Free trade talks began in 2015 under then-President Benigno “Noynoy” Aquino III, but it was stalled in 2017 during then-President Rodrigo Duterte's term amid the bloc’s concerns over the former chief executive’s deadly campaign against illegal drugs.

Santoro said the bloc and Manila are “culminated by the willingness to be fast” amid geo-economic concerns, arising from US President Donald Trump’s protectionist trade policy, which contributes for both parties' “stronger desire” to “have something quick in terms of results.”

“We hope the negotiations not only come to an end… but also the FTA entering into force before the expiration of the GSP+ current system,” the EU envoy said.

“This will be the best way to guarantee for the Philippines to continue benefiting from the GSP+ mechanism but also to expand these benefits… The GSP+ system at its current version is coming to an end by the end of 2027,” Santoro, adding that “this is why we are very much hopeful that we can be fast in these negotiations and secure good results for both sides.”

The EU envoy was referring to the EU’s Generalized Scheme of Preferences Plus (GSP+) —a trade arrangement which allows over 6,000 Philippine products to enter Europe duty free.

Santoro said the Philippines’ EU GSP+ utilization exceeded 80%, “the highest number achieved so far.”

In her remarks during the forum, Philippine Board of Investments Executive Director Evariste Cagatan, likewise, said the Philippines is aiming to conclude FTA negotiations with the bloc “ahead of the expiration of EU's Generalized Scheme of Preferences Plus, which currently provides duty-free access of more than 6,000 Philippine products to the EU market.”

Santoro said the EU and the Philippines have “already achieved a lot… been able to advance several chapters including closing several of them and now we are entering some more important substance next week.”

Data from the Department of Trade and Industry showed the EU is the Philippines fifth largest trading partner with total trade amounting to $11.39 billion from January to Augusto 2925 and a total trade of $15.54 billion in 2024.

The country’s exports to the EU market stood at $8.07 billion, while imports from the bloc amounted to $7.46 billion making it the country’s sixth largest export destination and also the sixth biggest import source, according to DTI data. — BM, GMA Integrated News