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Tuesday, October 26, 2021

After Singapore, PH seals trade pact with 4 Euro states

THE Philippines’ trade in services and agricultural exports to the European market are expected to receive a boost from the ratified free trade agreement (FTA) with the European Free Trade Association (EFTA) States.

The Senate last week unanimously ratified the Philippines-EFTA FTA, the country’s second bilateral free trade agreement after the Philippines-Japan Economic Partnership Agreement.

The EFTA is composed of Iceland, Liechtenstein, Norway, and the Swiss Confederation.

“Considering that EFTA requires the same standards as the EU (European Union), this will allow Philippine exporters to Europe to gain from economies of scale through improved market access in both EU and EFTA,” said Sen. Loren Legarda, who chairs the Senate committee on foreign relations.

Under the FTA with the EFTA, Legarda said the Philippines aims to secure market access for its agriculture exports, beyond EFTA commitments in its existing FTAs.

The agreement covers 90 percent of tariff lines for agricultural products.

“This will enable the Philippines to significantly improve the country’s market share visa-vis the other Association of Southeast Asian Nations (ASEAN) member-states in the EFTA market. Noting the similarities between the products that the Philippines and other ASEAN neighboring countries export to EFTA, the Philippines can take the opportunity to position itself as EFTA’s primary import source of these products,” Legarda said.

Positioning

Data from 2009 to 2013 indicate ASEAN exports to EFTA amounted to US$5.9 billion, with the Philippines accounting for only four percent. With the agreement, the Philippines is expected to account for a bigger share of ASEAN exports to the bloc.

The FTA also includes a simplified procedure for exporters, dispensing with the requirement of certification of origin, and in its stead, exporters could avail themselves of the self-declaration system.

Legarda said the country could also obtain market access for trade in services, including opportunities for Filipino professionals and skilled workers, while providing enhanced levels of protection.

Aside from boosting trade, the senator said it also aims to attract investments in services and non-services sectors or domestic competition with the view to make the Philippines as EFTA’s hub in ASEAN.

“Opening markets through agreements such as this goes hand-in-hand with all the economic reforms and ease of doing business initiatives of the government to project a clear message that the Philippines is, more than ever, ready and open for business,” she added.

The agreement will take effect as soon as the Philippines deposits its instrument of ratification in Oslo, Norway.

On the EFTA side, Liechtenstein, Norway and Switzerland have already ratified the agreement.

The Philippines is the second ASEAN country, after Singapore, to conclude a free trade agreement with EFTA. (NEWS AND FEATURES /PHILEXPORT)
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