The Philippines must play its cards right in renegotiating a trade deal with the European Union. Hundreds of thousands of Filipino jobs and 2 billion euros worth of Philippine commodity exports are at stake if Manila fails to work out an extension of the preferential tariff treatment granted by the EU.
The Philippines is a beneficiary of the EU Generalized System of Preferences Plus that offers tariff-free entry to some 6,724 Philippine products to the EU in exchange for compliance with 27 international conventions. The zero tariff makes Philippine products competitive in Europe and provides job opportunities in several local industries that are drawn to the European market. These products include dried and frozen mangoes, dried and frozen pineapples and banana chips.
The Federation of Free Workers has already warned that some 600,000 workers in the tuna industry could lose their livelihood if the Philippine government failed to renegotiate the trade incentives.
Easier access to the European market by way of zero tariffs, however, is tied to the progress the Philippines is making on several issues, such as labor rights, environmental protection, gender equality, health, education, social-economic rights, people trafficking and the fight against corruption.
The Philippines has generally done well in meeting the requirements of the 27 conventions. But the EU lately expressed its misgivings on the administration’s handling of the war on drugs and attempts to legalize the death penalty and reduce the criminal age of responsibility.
The criticism did not sit well with President Rodrigo Duterte, who eventually rejected European aid and claimed the EU was interfering on the country’s internal affairs. The EU, meanwhile, has threatened to impose economic sanctions on the Philippines.
Members of the Management Association of the Philippines are naturally alarmed with these developments. The removal of the GSP preferences, it says, will make Philippine products less competitive and seriously affect several industries. The association raised the specter of increasing unemployment during the time of pandemic.
The Philippines, according to Trade Secretary Ramon Lopez, is addressing the concerns of the EU with right information and facts. Manila must allay the fears of the European Union in the negotiating table where it matters. As in other trade negotiations, it must be forthright about the real conditions in the Philippines and stress its independence at the same time. We need all friends, not enemies, in these trying times.