The Southeast Asian nation of Philippines is all set to apply for the European Union’s new Generalized System of Preferences (GSP) scheme, or GSP Plus.
Philippines will apply for EU’s GSP Plus scheme, as it would provide more tariff reductions, the Department of Trade and Industry (DTI) said in a statement, reports Business Mirror.
The GSP Plus, also written GSP+, is a special EU incentive given to developing and least developed countries based on the effective implementation of 27 international human and labour rights conventions.
The GSP Plus is scheduled to take effect from January 1, 2014.
Philippines currently benefits from EU’s regular GSP, which covers 6,209 lines, of which, 3,767 items are subject to reduced tariffs, while the remaining 2,442 enjoy zero-duty.
On the other hand, GSP+ covers 6,274 products, which are all subject to zero-duty. The preferential margin between GSP and GSP+ is 9 percent for garments and 5 percent for textiles.
Hence, the Philippines garment sector is expected to benefit from GSP+ and would result in creation of about 40,000 new employment opportunities during the first eight months after Philippines qualifies for GSP+, according to various textile and garment associations.
The DTI has already held a meeting with stakeholders of the country’s garment sector and assured them of providing assistance on issues related to non-tariff measures and rules of origin to fully benefit from the GSP+.
Last year, the Philippines exported €1.07 billion worth of goods to the EU under the GSP, and DTI estimates the figure to rise by 12 percent if the country qualifies for GSP+.