MANILA, Philippines - The European Union (EU) has warned that if the Philippines continues to drag its feet on a possible Free Trade Agreement (FTA), the EU might not be able to accommodate the Philippines anymore because it is processing several agreements with other Asian countries.
This comes at a time when even Vietnam has already overtaken the Philippines in terms of exports of manufactured goods to the EU.
“We can only process a certain number of FTAs at a time,” EU Ambassador Alistair MacDonald told reporters after his speech during the second day of the Philippine Business Conference (PBC) at the Manila Hotel.
According to MacDonald, they are already in the process of negotiating FTAs with Korea and Malaysia. Vietnam, for its part, recently started the negotiations.
Trade Undersecretary Adrian S. Cristobal Jr. has already said that the FTA with the EU may take between four to six years to complete. “It entails a lot of work for all of us.”
He explained that FTAs should not be entered into lightly. In fact, the current FTAs of the Philippines has been underutilized. “Our own business sector has not been taking advantage of the opportunities with FTA,” he noted.
MacDonald said that Vietnam has overtaken the Philippines in terms of exports at an alarming speed. “Philippine exports to the EU fell rapidly more than other ASEAN countries’ exports to the EU, just as over the last six years or so Philippine exports to the EU rose more slowly than other ASEAN countries’ exports to EU,” MacDonald said.
The EU is the largest single export market of the Philippines accounting for 21 percent of the country’s total merchandise exports in 2009. The United States was only at 18 percent, Japan 16 percent, ASEAN 15 percent, Hong Kong eight percent and China eight percent.
The Philippines already has a Partnership Cooperation Agreement (PCA) with the EU. MacDonald explained that the PCA is not an FTA and does not include specific trade concessions by either party. It is expected to be signed in December.