(In photo: DTI Secretary Alfredo Pascual and European Commission Executive VP and Trade Commissioner Dombrovskis announcing the resumption of PH-EU FTA negotiations)
With the resumption of the Free Trade Agreement (FTA) negotiations, the Philippine Economic Zone Authority (PEZA) is optimistic more investors from the European Union (EU) countries will explore trade and investment opportunities in the Philippines this year and onwards.
At present, there are a total of 202 PEZA-registered projects with equity from the EU, generating about PHP300 billion of cumulative investments, USD12 billion of exports, and creating more than 50,000 direct jobs.
“The FTA would strengthen both the Philippines and the EU’s bilateral trade and economic relations, making an ecosystem fit for our agile investors given that the EU is the Philippines’ fifth largest trade partner,” PEZA Director General Tereso O. Panga said.
The resumption of the PH-EU FTA negotiations was announced by Department of Trade and Industry (DTI) Secretary and PEZA Board Chairman Alfredo Pascual and European Commission Executive Vice President and Trade Commissioner Valdis Dombrovskis on March 18, 2024.
The PH-EU FTA seeks to provide enhanced market access for goods, services and investments, going beyond the benefits of the Generalized System of Preferences Plus (GSP+) scheme. By committing to rules and higher standards, the FTA will also enhance competitiveness and foster sustainable, inclusive growth and development in the Philippines.
Under the GSP+, the Philippines has been benefitting from zero tariff on two-thirds of all product categories entering the EU market since 2014. The Philippines is proposing a four-year extension of the EU GSP+ which is set to expire by the end of the year.
The PEZA Director General noted, “The EU FTA and the renewed GSP+ status will help the Philippines in its bid to attract EU FDI (foreign direct investment) from diverse strategic industries, catering to both domestic and export markets. As one of the investment promotion agencies in the country, this will likewise be instrumental in PEZA’s quest towards positioning the Philippines as the ideal base for offshore operations by EU companies eyeing to penetrate the much vibrant ASEAN and AsPac markets.”
In relation to this, PEZA recently embarked on its first-ever investment mission to Madrid, Spain organized by the San Carlos Development Board Inc. (SCDBI), San Carlos City, Negros Occidental local government unit (LGU), Confederación Española de Organizaciones Empresariales (CEOE), and the Philippine Embassy in Madrid from March 18-23, 2024.
The highlight of the mission was the Philippine Investment Forum at the Centro de Filipinas en Madrid, where DG Panga made a presentation on the advantages and benefits of investing in Philippine special economic zones.
The event drew some 30 participants from the Spanish business chamber and investment companies, mostly from the shipbuilding, agro-industrial, pharmaceutical, IT-BPM, renewable energy, transport, steel and construction, water development, and tourism sectors.
According to DG Panga, the mission has huge potentials for offshoring in the Philippines to cater to the domestic as well as regional markets particularly in the fields of shipbuilding and agro-industry.
“With the Spanish government listing the Philippines as the only Asian country in its priority in the masterplan for Spanish cooperation, PEZA is taking this cue to attract Spanish investors into higher-value products and technologies (i.e., electronics, automotive, ship building, pharmaceutical, renewable and alternative energy, construction materials) to expand the current trade of mostly agro-based products between our two countries,” he added.
With the recent mission of President Marcos Jr. to Germany and Czech Republic, PEZA is organizing an investment mission in partnership with the German-Philippine Chamber of Commerce and Industry (GPCCI) to do follow-through on the investment leads and touch base on prospective industries and latest investment trends in Germany.
GPCCI’s AHK World Business Outlook Fall 2023 revealed German firms operating in the Philippines have the highest optimism in terms of business and hiring outlook for the next 12 months compared to their peers in other Southeast Asian countries.
“With this outlook, we will continue to push for addressing the barriers for investments and be aggressive in our investment promotion and facilitation initiatives as we make the Philippines an enviable destination in the region,” DG Panga stressed.
