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Tuesday, March 5, 2024

EC recommends 4-year extension of zero tariff granted to Philippine exports

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The Department of Trade and Industry (DTI) welcomed the European Commission’s (EC) recommendation for a four-year extension of the EU Generalized Systems of Preference Plus (GSP+) which provides preferential tariff to exports from a number of countries including the Philippines.

The EC document highlighted the Philippines compliance to most of the conditions attached to the utilization of the trading scheme, but also noted some compliance delays in some of the conditionalities.

DTI Secretary Alfredo Pascual underscored the importance of the preferential tariff scheme to Filipino exporters.

“This is good news for us. At least we’ll have another four years [of GSP+ utilization]. This is very important for our tuna exporters and producers of manufactured products,” Pascual said in a presentation at the 2023 Pilipinas Conference in Makati City.

Based on the report released by the European Commission on Nov. 21, 2023, “it is fundamental to provide continuity and legal certainty for GSP beneficiaries and business.”

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Th existing GSP+ scheme is about to expire by end-December 2023 while the European Parliament is still deliberating on some of the conditions attached to the extension of the zero-tariff trade policy.

The report noted that the Philippines’ utilization rate of GSP+ tariff preferences steadily increased in recent years, reaching 77 percent in 2022. About 90 percent of total EU imports from the Philippines enjoy zero tariff.

Close to 3 billion euros worth of goods imported to the EU benefitted from GSP+ preferences last year, data showed.

The scheme contributed to sustaining the level of the Philippines’ exports to the EU during the pandemic, despite the rising costs of logistics and raw materials.

The EU is the Philippines’ fourth largest trading partner, accounting for 7.6 percent of the country’s total trade in 2022, after China, Japan and the US.

Pascual encouraged exporters to the EU to take advantage of GSP+ while the preferential tariffs are in effect.

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