More Phl firms tap EU GSP+ scheme

MANILA, Philippines -  More local firms took advantage of the European Union’s Generalized System of Preferences Plus (GSP+) scheme last year even as the fate of the country’s status as a beneficiary has been hanging in the balance.

EU delegation to the Philippines head of trade and economic section Walter van Hattum said the country has made the most of the EU GSP+ in 2016, with its utilization rate increasing to 71 percent from 66 percent the previous year.

He said Philippine exports under the GSP+ last year reached €1.71 billion, an increase from the $1.55 billion recorded the previous year. This accounts for 27 percent of the country’s total exports to the EU.

“So it’s quite an increase because the overall exports from the Philippines to the world and to the EU declined a bit, but the GSP+ went further up. What you see is a lot of agriculture products, as roughly half of the exports on the GSP+ are agri-food at around €750 million,” Van Hattum said.

“Having said that, if you look at a similar-sized economy to the Philippines like Pakistan, 89 percent of their exports came in through GSP+. So it’s a bit like the Philippines is just getting started so it takes industries a little bit of time to take more advantage of it. But I’m very happy a lot more industries are finding the benefits,” he added.

According to the EU official, political issues that arose between the European bloc and the Philippines since President Duterte came into power last year have had no impact to the country’s exports to the EU and on exporters making use of the GSP+ benefits.

“For business, it’s no problem. For them, it’s free access to European markets and the whole political debate is done by the government. So if you’re in the business, you just go ahead and take advantage,” he said.

“It becomes even more important (as global trade slows), especially for a country like the Philippines which is trying to develop because the GSP+ benefits us especially in sensitive sectors which normally have fairly high tariff,” Van Hattum added.

Van Hattum said the Philippines is seen further increasing its utilization of the EU GSP+ this year.

“I think the Philippines is doing well, but I think it could be a lot more because some of these sectors are very important for agriculture, for farmers.  The Philippines has a competitive advantage, you have a lot of products here, you just need to make them move towards the European market. So it’s getting there,” he said.