Business Mirror | Tuesday, 24 March 2009

EC pushing for RP-EU bilateral trade deal with impasse in Asean-EU FTA

Written by Max V. de Leon / Reporter

THE European Commission (EC) is urging the Philippine private sector to persuade the government to pursue a bilateral economic cooperation deal with the European Union (EU) now that the negotiation for a region-to-region free-trade agreement (FTA) between the Association of Southeast Asian Nations (Asean) and EU has reached an impasse.

Gabriel Munuera Vinals, head of political, economic, trade and public affairs of EC’s mission in Manila, said although other countries in the region have already launched their FTA negotiations with EU, the Philippines can still become the first Asean country to conclude it and benefit from more investments and better access to the European market.

“I have no doubt that in the case of the Philippines, we will definitely have the partnership cooperation agreement concluded in a very reasonable time frame,” Vinals said in a forum organized by the Philippine Chamber of Commerce and Industry and the Universal Access to Competitiveness and Trade at the Heritage Hotel on Tuesday.

This, he said, will happen if the Philippine private sector will help the government come up with an intelligent choice, and that is “to go ahead and show interest, go for a comprehensive and ambitious FTA which will bring a lot of value for the Philippines.”

At this time, both the EU and Asean have decided to take a breather in their negotiations for a bi-regional FTA after issues like the political problem in Myanmar and the different levels of development among Southeast Asian countries became major stumbling blocks.

One option that can be pursued is the so-called variable geometry, in which some more developed Asean countries will go ahead first, while the less developed can follow after several years.

But Trade Assistant Secretary Ramon Kabigting said in Asean’s meeting early this month in Kuala Lumpur, the region’s negotiators agreed that if an engagement with the EU will be pursued, all the Southeast Asian nations will have to participate.

Of course, Kabigting said there is always that possibility that individual nations will push ahead with their respective bilateral negotiations with the EU despite this common stand by Asean.

For the Philippines, Kabigting said the country is ready to engage the EU for a bilateral cooperation agreement “in each and every issue.”

Vinals said this statement by Kabigting, if coupled with a pronouncement from Trade Secretary Peter Favila, would be enough to trigger the start of the negotiations for the RP-EU FTA.

He said the Philippines needs the FTA because at this time, it is lagging behind Singapore, Indonesia, Malaysia, Thailand and Vietnam in attracting European investors.

Also, trade between the Philippines and the EU have been declining by an average of 2 percent in the last five years, while the rest of the region experienced a 6-percent growth.

Through the FTA, the EU, he added, will also be able to share its competency in the Philippines’ sunrise industries such as tourism, health care, design and agribusiness.