DTI hopes to conclude the EU’s free trade agreement by 2027

The Department of Trade and Industry (DTI) said it is optimistic about the completion of the Free Trade Agreement (FTA) with the European Union (EU) before the 2027 target.

“The Philippines aims to conclude these trade negotiations by 2027… But I could be more optimistic given that negotiations between the Philippines and the European Free Trade Association (EFTA) took only a year. So we have a model to follow,” Trade Secretary Alfredo E. Pascual said Monday during the European-Philippine Business Dialogue.

EFTA is a bloc of the non-EU European economies Switzerland, Norway, Iceland and Liechtenstein.

“We hope to align the FTA with our goals of achieving upper middle-income status and going beyond the EU Generalized Framework of Preferences (GSP). We hope to be promoted to the FTA,” Mr Pascual added.

He cited positive indications from preliminary discussions, which indicate a high level of understanding between the two sides.

“But it’s still hard to speculate because this could still happen faster or slower. It is a matter of understanding each other’s interests,” he said.

“I think the discussions on peripheral issues may take some time as this does not just include tariffs; this also includes other requirements that are not trade related,” he added.

In addition to increasing bilateral trade, Mr. Pascual said the DTI would consider the FTA talks successful if the Philippines maintains its privileges under the GSP Plus program and if they see an increase in investments.

“In addition to maintaining preferences for the Philippines’ key exports, a key motivation to really push for the FTA is to attract more European investment,” he added.

In terms of priority investment areas, Mr Pascual mentioned electric vehicles, renewable energy, sustainable development, digital trade, and food processing and biotechnology. The DTI also hopes to strike a deal that will allow for greater talent mobility.

During the event, the European Chamber of Commerce of the Philippines (ECCP) delivered its 2024 advocacy documents to the government, highlighting at least fourteen ECCP advocacy priorities that the chamber hopes will improve economic outcomes.

“Building on the successes of previous advocacy initiatives, we remain steadfast in pushing for policies that promote sustainable development and create a level playing field for both European and Philippine companies,” said ECCP Executive Director Florian Gottein.

The 316-page document also contains the House’s assessment of the government’s response to its recommendations last year. In particular, she recognized the signing of the Ease of Paying Taxes Act, the Internet Transactions Act and the Public-Private Partnership Code of the Philippines.

“The economic reforms we discussed are delivering tangible results. There is increased interest from European investors in areas such as green energy and digital transformation, among others,” said ECCP President Paulo Duarte.

“While there are uncertainties and challenges ahead, we remain optimistic that maintaining an open and regular dialogue will be mutually beneficial as we collectively navigate our path to greater success,” he added. — Justine Irish D. Table