Outgoing EU envoy cites need to forge FTA

MANILA, Philippines — Outgoing European Union (EU) Ambassador to the Philippines Franz Jessen yesterday stressed the need to reach a free trade agreement (FTA) between the two parties to allow the Philippines to continue to benefit from the bloc even when its beneficiary status under the Generalized System of Preferences Plus (GSP+) expires.

He said there is a need to build constructive relationship with the Philippine government and look at how to grow investments from the bloc.

“There would be a time when GSP+ would no longer be needed in your country. And that means the FTA should replace it and it is important we work towards getting that replacement in time so that the Philippines can continue to benefit from the EU market,” Jessen, whose term ends on Friday, said in a press briefing.

Secured in December 2014, the GSP+ beneficiary status allows the Philippines to enjoy zero duty for 6,274 products exported to the EU.

As the EU GSP+ benefits are available only for 10 years and given to low or lower-middle countries, the Philippines would lose its beneficiary status when the validity period ends or once its gross domestic product per capita reaches $4,000.

“When I came here four years ago, I did hope I would be leaving with the signed FTA. That’s what happened in Vietnam when I was there for four years. But I can see it is more complicated here. Part of the complications is we do need the political commitment from both sides to say that we want this to happen,” Jessen said.

Two rounds of negations have been conducted for the EU-Philippines FTA talks so far, with the first one held in May 2016 in Brussels in Belgium, and the latest in February 2017 in Cebu.

While the EU would want to make progress on the FTA talks, he said no schedule has been set yet for the third round of negotiations.

As implementation and respect for conventions on human rights, labor rights, environment and good governance are deemed important by the EU in its relationship with the Philippines, the bloc has earlier raised concerns on the Duterte administration’s war on drugs.

Jessen said the war on drugs has affected how the Philippines is perceived by other countries, as well as investors.

“Clearly, we are trying to understand what the government here in the Philippines is seeking to do. We are trying to listen very carefully to their views. We do believe in Europe there is no contradiction between human rights and economic growth…Values we are promoting in EU are fully consistent with economic growth,” Jessen said.

Even as no schedule has been set yet for the third round of FTA talks, he expressed optimism the conclusion of the deal would come at some point.

Asked what advice he would give his successor, he said it is important to work on having a constructive relationship with the Philippine government.

“When it comes to that, don’t react immediately. So, when things are happening, maybe step back and wait for a little bit before you react. I think there is no point in getting in a tit-for-tat discussion in public here. For us, it’s very much a question of having constructive relationship with the government,” he said as there are matters where the parties may not be on the same page.

“They (Philippine government) have in some cases, different ideas than we have and in some cases also, they get back to the ideas we had… It is important for us that when we can work together, we do work together,” he added.

He said he would also tell his successor to look at ways to increase EU investments in the Philippines.

“We have not had the growth of investments that I would have hoped and I think it’s something that we need to look at and something I would advice my successor to look at very carefully because investments is a two-way street. It is not only that you need companies from Europe that want to look into investing in East Asia, Southeast Asia. But it also is a question of what policies are in place in the different countries,” he said.

He said the Philippines could benefit more from investments made by EU companies if it would have a more competitive labor force not based solely on costs, but on quality of work.