The Delegation of the European Union to the Philippines on Tuesday assured the country of continued access to EU Generalized Systems of Preference Plus (GSP+) privileges following the approval by the EU Parliament and EU Council of the extension of the preferential trade system.
EU Delegation Minister Counselor Philipp Dupuis said the final step of extending the EU-GSP was set to motion and culminated in its approval last week.
“Basically what we did is we prolong the current GSP regulation which covers GSP+ for another 4 years,” Dupuis said at the sidelines of the EU-Philippine Partnership Conference Tuesday, a segment of the ongoing 2023 National Exporters’ Week and National Export Congress at the Sheraton Manila.
Dupuis said the preparation for a new regulation was taking time, while the expiry of the current GSP+ was almost on hand. “That is why the current one was prolonged because everybody realized that this discussion will need more time. Once that expires, the legal basis for its existence will likewise dissipate,” he said.
Discussions for a follow-up scheme is underway that may incorporate additional conditionalities, he added.
The Philippines’ utilization rate of GSP+ tariff preferences has steadily increased in recent years, reaching 77 percent in 2022.
Close to 3 billion euros worth of goods exported to the EU benefitted from GSP+ preferences in 2022, or about 90 percent of total EU imports from the Philippines.
The scheme contributed to sustaining the level of the Philippines’ exports to the EU during the pandemic, notwithstanding the rising costs of logistics and raw materials.
The EU is the Philippines’ 4th largest trading partner, accounting for 7.6 percent of the country’s total trade in 2022, while the Philippines is the EU’s 39th largest trading partner globally, accounting for 0.4 percent of the EU’s total trade.
EU exports to the Philippines were dominated by machinery, transport equipment, chemicals and food products, while the Philippines’ main exports to the EU included office and telecommunication equipment, machinery, food products, and optical and photographic instruments.
The Department of Trade and Industry (DTI) asked exporters to the EU to maximize their exports to continue benefiting from GSP+ while the preferential tariffs are in effect.
About 28 countries were given access to the trade scheme, including the Philippines.