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Thursday, June 20, 2024

ECCP pushes for elimination of duties on car imports from Europe

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The European Chamber of Commerce of the Philippines said it strongly supports adopting measures in the EU-Philippines Free Trade Agreement that eliminate import duties for automotive vehicles and automotive parts from the EU with immediate effect upon ratification.

Based on recently released automotive advocacy paper by the ECCP, the group said that while there is a positive trend toward market increase, European automobile brands tend to lose out in the Philippine market in terms of price competitiveness because their goods are generally in the high price-tiered segment.

Adopting these measures will ensure that European automobile brands are more competitive in the local market, the ECCP said.

The group said European vehicle companies in the Philippines are subject to several taxes and duties, including customs, value-added tax and excise tax which raise the cost of the vehicles by nearly 102 percent of their retail prices.

It said Asian counterparts benefit from more competitive and preferential tariff rates as a result of existing bilateral and multilateral trade agreements.  These include the country’s FTAs with Japan and South Korea through the Association of Southeast Asian Nations -South Korea FTA and the Philippine-Japan Economic Partnership Agreement.

Data from the Department of Trade Industry show that the Philippines has the lowest number of FTAs at 10, compared to Singapore’s 27, Malaysia’s 17 and 15 each for Thailand, Indonesia and Vietnam.

The ECCP and its automotive committee said an FTA between the EU and the Philippines would level the playing field for European firms to prosper in the country and offer consumers wider options that could compete in terms of high-quality sustainability and safety standards.

“With this in mind, we support the government’s renewed interest to resume talks on the Philippine FTA with the trade bloc,” the ECCP said.

The chamber is also seeking increased promotion of the ease of doing business and streamlining of customs processes for automotive parts and products.

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