November 06, 2022
The Philippines is working on the ratification of the ILO Convention 81 on Labor Inspection, one of the six proposed additional conventions by the EU Commission for a trading partner to continue enjoying the EU-Generalized System of Preferences+ (EU-GSP+).
Trade and Industry Assistant Secretary Allan B.Gepty said though that of the six proposed additional conventions, only the Labor Inspection that the Philippines has yet to ratify.
“We are already working on the ratification process,” he said noting that “Philippines is a strong advocate of labor rights and welfare, thus, working on this accession will further strengthen our regime for the protection of workers.”
According to Gepty, the Department of Labor and Employment (DOLE) is working on the usual process. After getting all the concurrence of agencies, he said, the Department of Foreign Affairs (DFA) will assess if ratification can be done via executive agreement or treaty.
“If the process will be via treaty accession then the ratification will still be subjected to Senate concurrence,” said Gepty.
Gepty, however, said that EU has yet to finalize the additional requirements for the proposed new EU GSP+ scheme.
For the new EU GSP+, he said, the Philippines will pursue the same as it will not only maintain the country’s comparative advantage in the EU market but it can further boost the country’s exports as well encourage more investments in the country.
At present, the Philippines is the only ASEAN Member State enjoying such privilege in the region. “With the Philippines FTA network and GSP+ advantage, it can well position itself as a manufacturing hub in the region,” he added.
Since the Philippines’ successful application to the GSP+ in 2014, the country has benefited from increased market access to the EU. Philippine exports to the EU climbed from EUR5.3 billion in 2014 (under the standard GSP) to EUR7.77 billion in 2021. In 2021, the Philippines recorded its highest utilization rate at 76 percent of total eligible exports, including tuna, processed fruits, and spectacle lenses.
The GSP+ has benefited EU companies as well, as they invest in manufacturing facilities in the Philippines to take advantage of the country’s extensive and expanding domestic market as well as its network of FTAs, which includes those with ASEAN. They have also gained from relatively lower cost of raw materials.