British Ambassador: Brexit won't hurt UK-Philippines trade relationship

British Ambassador Daniel Pruce. (Photo by Katlene O. Cacho)

CEBUANO exporters will continue to enjoy tariff perks even after the United Kingdom (UK) exits the European Union (EU) trade bloc, as the UK promised to continue giving out similar trade preferences for exporters.

In a media briefing Thursday, May 23, 2019, British Ambassador Daniel Pruce stressed the importance of maintaining its trade relationship with its allies, even after it leaves the EU.

Pruce said Brexit will have no negative impact on the trading relationship with the Philippines, as it plans to continue its trade deals with the country to provide predictability for Filipino business owners exporting goods to the UK.

“When the UK leaves the EU, we will come out of the European Union Generalized Scheme of Preferences Plus (EU GSP+) but we have already made a commitment that as soon as we will leave the EU, we will establish our own trade preference scheme that will maintain the same level offered in the current EU GSP+,” said Pruce.

Pruce was in Cebu for his first diplomatic visit as British ambassador to the Philippines.

The Philippines is a beneficiary of the EU GSP+ where 6,000 export products to any of the 28-member countries of the EU are at zero tariff. Over 3,000 export goods destined for the US also get zero tariff under the same scheme.

The UK accounts for less than 10 percent of total Philippine exports to the EU, with almost 11 percent of Philippine exports to the EU under the GSP+ going to the UK, and 35 percent of total Philippine exports to the UK for 2017 being made under GSP+.

The country’s exports to the UK include costume and fine jewelry, holiday decor, housewares, garments, furniture, seaweed, footwear and leather goods.

The UK’s withdrawal from the EU remains a continuing discussion and debate. But Pruce assured that whatever process the UK needs to undergo, it will continue to maintain and develop its existing relationships with its trade partners like the Philippines.

The Department of Trade and Industry said the Philippines has engaged the UK in three high-level dialogues where the UK assured the country’s representatives about the continuation of the Philippines’s GSP+ level market access to the UK post-Brexit.

“The retention of the Philippines’s GSP+ level preferential market access to the UK is a huge assurance for Philippine exporters. For products that are not covered by the GSP+, Most Favored Nation (MFN) rates will apply. On this front, the Philippines is also actively engaged in negotiations in the World Trade Organization for the final MFN bound rates that the UK will apply after Brexit to ensure that products of interest for the Philippines will not be prejudiced by any changes,” said DTI Secretary Ramon Lopez, in a statement.

The economic consequences of the UK exiting from the EU bloc will not have a significant impact on Philippine exports, said Fred Escalona, executive director of the Philippine Exporters Confederation Inc.-Cebu, in past interviews.

“I personally do not think our exporters need to worry about anything. It will be the British economy that would suffer in the long term by exiting the EU rather than the rest of the EU states and countries they trade with,” said Escalona.

“Trade with the EU, whether we are exporting from the Philippines or exporting as part of Association of Southeast Asian Nations will continue to prosper,” he added.

Pruce added that the UK is also holding consutations on its migration policy after the EU exit. He said they will review the skills needed when they become an independent state.

But he noted that the Philippines has been one of the UK’s “excellent sources of healthcare professionals,” particularly for nurses. There are currently 17,000 Filipinos working in the UK.


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