THE Philippines’ utilization rate on its preferential trade scheme with the European Union (EU) is estimated to have remained at 25%, Delegation of the European Union to the Philippines Chargé d’ Affaires Thomas Wiersing told reporters at a press conference on Monday.
Under the GSP+ scheme, the Philippines enjoys zero or reduced tariffs for over 6,000 export products.
The estimate was released ahead of the official tally of Philippine availments of the Generalized System of Preferences-Plus for 2019.
“While GSP+ utilization rate for 2019 has yet to come out, it is estimated that around 25% of total Philippine exports to the EU — approximately two billion euros — benefits from the EU GSP+ trade preference, particularly in agri-products,” he said.
Mr. Wiersing said that he hopes the utilization rate will improve in 2020.
“It is also hoped that with the implementation of the REX system of self certification by the EU beginning January 2020, Filipino exporters will have faster processing time for their documentary requirements specific to GSP+ specific products.”
The REX guidelines simplify export processes by allowing exporters to certify preferential origin through a Statement of Origin.
The biennial GSP+ report by the European Commission, which assesses partner countries’ commitments to international conventions such as human rights and freedom of expression, is expected to be released early this year.
“The report will cover the 2018-2019 progress of the Philippines in the implementation of 27 international conventions relating to human rights, labor rights, environment, and good governance,” Mr. Wiersing said.
Meanwhile, Mr. Wiersing added that there is a worrying deterioration in the Philippines’ attractiveness to foreign direct investment, citing factors such as a decline in business confidence due to lower consumer demand, stiffer competition, and uncertainties surrounding tax reform.
“Despite the efforts and successes of the government to streamline processes to attract more businesses to locate and invest in the country, the business climate still requires an upgrade,” he said. — Jenina P. Ibañez