6 sectors flagged under proposed EU-PH FTA
Six sectors – automotive; clothing, apparel and footwear; fisheries; tourism; other business services; and office and telecommunications equipment – have been flagged for in need of in-depth analysis as these sectors present offensive and defensive interests for both the EU and the Philippines when they pursue the proposed bilateral free trade agreement (FTA).
A Draft Inception Report by a Study Team, which conducted the Sustainability Impact Assessment (SIA) in support of the FTA negotiations between EU and Philippines, flagged these sectors following a preliminary screening and scoping of economic, social, human rights and environmental issues.
This report provides an overview of the general approach of the Study Team in carrying out the EU-Philippines SIA and establishes the foundation for the methodology, research and analysis. Moving forward, this Report will serve as a guide to the discussion between the Study Team and the Inter-Service Group leading to the next phases and the Interim Report, to be followed by a Final Report in January 2019.
For the sectors for which in-depth analysis is proposed and confirmed, the Study Team will undertake additional qualitative impact assessments. The analysis would identify problematic barriers that could be resolved within the EU-Philippines FTA and potential impact on sectors affected.
On automotive, the preliminary report said that the Philippines has offensive interests as its is expanding exports for vehicles and components. It has also defensive interests in terms of protecting the domestic, which EU has primarily offensive interests.
On clothing, apparel and footwear, the Philippines has primary interest and EU has defensive interests. On fisheries, both trading partners have defensive interests. This is also similar to the tourism sector.
The Philippines being the world’s leading BPO services provider has offensive interests in this sector where EU can help the Philippines transition to high-value BPOs.
For the office and telecommunication equipment sector, the EU-Philippines SIA Study Team said that EU can expand exports to the southeast Asian countries via the Philippines. In the same manner, the Philippines can expand its exports and improve its value chain to EU.
In addition to the qualitative impact assessment, the offensive and defensive interest of the EU and Philippines are highly relevant for selecting sectors and/or products for in-depth case-study and review.
At this relatively early stage in negotiations between the EU and the Philippines, these interests have not yet been fully articulated, the report said.
Nevertheless, the EU has completed agreements with two ASEAN member states, namely Singapore and Vietnam. These agreements are expected to serve as reference points for future agreements with other ASEAN member states, including the Philippines. The degree of liberalization attained and the carve-outs for sensitive sectors and issues will of course differ between these countries and Philippines, reflecting their distinct economic, social, environmental and human rights contexts.