"The waiver approval is a positive development in the area of our bilateral trade relations since the United States represents an important market for Philippine exports of coco fatty acids," Aquino said.
The new DTI chief added that the waiver approval by the US significantly benefits Philippine exports, particularly the coconut industry and its allied activities.
The coconut industry, Aquino said, provides the raw feedstock, particularly coconut oil processed from the country’s copra (coconut meal) production.
"The DTI views this favorable development as being only consistent with the purpose of the GSP program, that is, to promote development through trade rather than through traditional aid programs. Continued enjoyment of the GSP provides an impetus for the country to export higher value products like coco fatty acids," Aquino said.
The Philippines, through the DTI Bureau of International Trade Relations (DTI-BITR) re-submitted the petition on coco fatty acids last year for consideration in the 2004 US GSP Review.
The results of the GSP Review are embodied in a Presidential Proclamation on GSP modifications that was signed on June 10 and released on July 1 this year.
The competitive need limit (CNL) waiver effectively restores the duty-free treatment accorded to Philippine exports of coco fatty acids starting July 1 this year.
This means that the US will not impose ceilings on the GSP duty free benefits of the country’s coco fatty acids exports.
The Philippines was not able to get GSP duty-free privilege for the coco fatty acids in July 2003, thus, the product was levied a 2.3-percent Most Favored Nation (MFN) tariff.
The US imposed ceilings on the GSP benefits through the CNL provisions to ensure that the less competitive countries, including the US domestic industry, will not be unduly disadvantaged by the more competitive country suppliers.
The Philippine’s exports of coconut fatty acids reached $28.223 million in 2004, slightly down by 3.64 percent as against the $29.288 million registered in 2003.
The US ($17.742 million); Malaysia ($2.326 million); Spain ($1.932 million); China ($1.901 million); and The Netherlands ($1.699 million) are the country’s top buyers of coco fatty acids.
Exports of coco fatty acids continue to increase positively in the first four months of the year with shipments already amounting to $13.188 million, an increase of 30.76 percent from only $10.086 million in the same period last year.