The European Parliament has completed the last stage in the process to grant the Philippines Generalised System of Preferences Plus (GSP+) that will provide duty free entry to the EU for some of the most important Philippine exports, including garments and textiles.
The Philippines is already a beneficiary to EU’s GSP. In 2013, total Filipino exports to the EU that were eligible under GSP amounted to €1.69 billion or 33 per cent of total exports to the EU, but actual utilisation was around 64 per cent or €1.08 billion. The GSP+, which will enter into force in the coming weeks, will result in increase in this amount.
The greatest benefit that is likely to be gained from GSP+ is the attraction of new industrial investments in sectors where relatively high tariffs are being slashed to zero under GSP+. These include established Filipino exports that are labour intensive such as garments, which currently attract tariff ranging from 5-9 per cent for exports to the EU.
“This is very good news for the Philippines as it will bring tariffs to zero per cent for two-thirds of tariff lines including strategic products that the Philippines’ is already exporting to the EU. This will immediately translate into savings of tens of millions of euros per year in foregone customs duties,” stated EU Ambassador Guy Ledoux.
“Apart from giving a dramatic and immediate advantage to Philippine exports, the EU concession significantly improves the attractiveness of the Philippines as a destination for new agricultural and manufacturing facilities for products that will now enjoy duty free access to the EU. This gives the Philippines a comparative advantage and represents very tangible EU support to the Philippine strategy to increase exports and investments, and diversify its industry. The bottom line is more jobs for Filipinos in the Philippines,” Ledoux added.
The European Union provides GSP+ preferences covering over 6,200 tariff lines to create economic benefits that will help the Philippines to assume its responsibilities under core international conventions on human and labour rights, environmental protection and good governance.
The EU, which is also a party to these conventions, will keep under review their effective implementation by the Philippines, as well as its cooperation with their monitoring bodies.
The exports of apparel and accessories from Philippines grew by 14.7 per cent to US$ 1.557 billion in January-October 2014, compared to exports of $1.357 billion made during the corresponding period of last year, according to data from the Industry and Trade Statistics Department, under the Philippine Statistics Authority. (RKS)
Fibre2fashion News Desk - India