EU pushes bilateral trade pact
BusinessWorld, Manila
EU pushes bilateral trade pact
By Jessica Anne D. Hermosa, Reporter
19 January 2010
The Philippines might lose an opportunity to get first crack at negotiating a bilateral trade deal with the European Union as three Southeast Asian neighbors are already in line.
Vietnam and Thailand have already expressed interest while negotiations with Singapore are set to begin, EU officials said, also hinting that the bloc may be unable to accommodate all Association of Southeast Asian Nations (ASEAN) member-states in one go.
"The Philippines has not so far signalled its readiness to engage in this way," EU Ambassador Alistair MacDonald told BusinessWorld in an e-mail yesterday, referring to plans to forge bilateral trade pacts after attempts to broker a broader agreement with the 10-member ASEAN hit a roadblock early last year.
Asked whether the Philippines might be crowded out by its neighbors, the delegation’s commercial counselor, Gabriel Munuera Vinals, said in an e-mail: "There are indeed resource limitations to the capacity of the EU to negotiate parallel free trade agreements with individual ASEAN countries."
The EU has been approaching ASEAN members for separate deals after talks for an ambitious region-to-region trade pact stalled over whether to include military-ruled Myanmar, among other reasons.
The bilateral deals, said Mr. MacDonald, will eventually be stitched into a regional trade pact.
The Trade department, however, last week said that giving the upcoming elections, the decision to enter into talks will likely have to be left to the next administration.
Concerned about the Philippine government’s continued inaction, the European Chamber of Commerce of the Philippines has warned that the country might miss being part of the first batch of negotiations and will thus be limited to the confines of deals earlier brokered by Southeast Asian neighbors.
The invitation, however, still stands, Mr. MacDonald said.
"Should the Philippines indicate a serious interest in engaging bilaterally with the EU, we would be ready to explore the possibilities," he said.
"It is our analysis that an ambitious FTA with the EU would be of value to the Philippines, both with respect to enhanced access to an affluent market of 500 million consumers, and to create the sort of predictable economic environment that would facilitate much larger flows of investment and of know-how."
The Philippines counts the EU as its top source of direct investments and second largest market for exports after North America, central bank data for 2008 show.
Mr. MacDonald went on to clarify that the Philippines inclusion in talks for a trade pact "is no way linked" to a current dispute between the two economies over local taxes on imported liquor.
