Export leader bats for US retention of GSP treatment of RP goods
Sun-Star, Manila
Export leader bats for US retention of GSP treatment of RP goods
13 August 2006
Philippine trade negotiators must right away ask the US not to include the Philippines in the list of 13 developing countries slated to lose their General System of Preferences (GSP) so as not to disrupt the momentum of exports to the country’s top market.
Philippine exports surged by over 20 percent for the month of June, the fifth straight month it registered double-digit growth, which was the norm for nine straight years until the year 2000.
Poor nations with GSP privileges in the US enjoy tax-free entry in the US market of a wide range of product lines.
"The government must also review the offered alternatives if these are sufficient to replace the lower import taxes enjoyed by Philippine goods entering the US under the GSP arrangement," said Sergio R. Ortiz-Luis, Jr., president of the Philippine Exporters Confederation Inc. (Philexport).
The US earlier announced it is reviewing the GSP privileges of some better-off developing nations targeting to drop 13 countries led by India, Brazil and the Philippines. The review was an offshoot of the collapse of trade talks under the World Trade Organization (WTO), which the US Congress blamed on large developing countries that refuse to open their markets to more imports.
"If the alternatives prove unacceptable as a substitute to the GSP, we must as well include the present arrangement in our free trade talks with our former colonizer," Ortiz-Luis said.
Formal talks between the US and the Philippines for a free trade agreement have yet to start even after US trade experts said it has been waiting for the Philippines to take the first steps as early as last year.
The consultants said because US exports to the Philippines are miniscule, it does not consider a bilateral agreement with its former colony a high priority. The initiative must then come from the Philippines.
Ortiz-Luis said it is precisely the tiny share of Philippine trade in the US economy that the Philippines must be dropped from the target countries whose GSP privileges are to be scrapped. On the side of the Philippines, exports to the US make up between 19 and 20 percent a month.
"Besides lumping the Philippines with large developing countries like India and Brazil is unfair. We must capitalize on our being a die-hard political ally of the US," he added.
Extensive studies and consultations with stakeholders by private research groups to help Philippine negotiators come up with negotiating positions beneficial to the Philippines have been conducted and the results have been submitted to the trade negotiators.
It is not known however if the Philippine Government has made a formal request with the trade representative office of the US for the free trade agreement (FTA) talks to commence.
The US already has an FTA with Singapore and has had advanced talks on a similar arrangement with Thailand while the Philippines has yet to sign its first ever free trade agreement with Japan. (Abe P. Belena/Philexport News and Features/Sunnex)
