No thanks to EU

The Philippines’ decision to decline financial assistance from the European Union is downright irresponsible and childish. The move reflects government’s myopic view of what the EU grants are all about and virtually belittled what the assistance has done to alleviate poverty in vulnerable regions, especially Mindanao.

The Philippines in an announcement Wednesday said it would no longer accept new grants from the EU, or those that “interfere with the internal policies” of the country. EU Ambassador Franz Jessen said over 250 million euros, or $278.7 million, worth of grants could be affected by the decision.

Manila’s decision is clearly a knee-jerk reaction to the European bloc’s criticism of President Rodrigo Duterte’s deadly drug war that has killed about 2,700 people. Another 1,800 people have been killed by unknown gunmen, while the police said about 5,700 other violent deaths are under investigation.

The EU is the Philippines’ eighth-biggest source of aid, with assistance reaching $217 million in 2016. But Mr. Duterte had challenged the EU to stop the assistance, after the bloc warned that the Philippines risks losing duty-free exports to Europe because of the thousands killed in his war on drugs. Mr. Duterte last year also used profanities in response to a European parliament statement expressing concern over the killings.

EU’s criticisms of Duterte’s violent drug war, however, should not overshadow the bloc’s humanitarian program aimed at reducing poverty in the Philippines and its support to the peace process in Mindanao. The EU has noted that economic progress in the Philippines has had little impact on poverty reduction because of high population growth, unemployment, corruption and feudal politics.

The bloc’s funding assistance has focused on the health sector, governance and the vulnerable populations, particularly in Mindanao where people are being displaced by the Muslim rebellion.

The government should weigh carefully its decisions or policy shifts when dealing with respected international groups like the EU. The bloc has been generous to the Philippines, being the biggest foreign investor in the country. The Philippines is also the only country in Southeast Asia that enjoys tariff-free exports under EU’s Generalized Scheme of Preferences +, or GSP+, incentives for developing countries.

The Philippines, for one, should not risk losing that trade privilege with the EU. Duty-free exports to EU amounted to an estimated 1.6 billion euros, or $1.78 billion, in 2016. A forfeiture of the special trade treatment from the European bloc will directly translate into reduced foreign exchange revenues and job losses.

Topics: Editorial , President Rodrigo Duterte , financial assistance , European Union , EU , EU Ambassador Franz Jessen
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