European businesses welcomed the restart of talks between the Philippines and the European Union (EU) for a free trade agreement (FTA), as they emphasized the importance of trade deals in promoting economic growth and stronger ties.

The European Chamber of Commerce of the Philippines (ECCP) said the official resumption of negotiations for the FTA is seen as a welcome development with the renewed interest underscoring the attractiveness of the Philippines as a prime business destination for European firms and the mutual benefits of fostering deeper economic ties.

'The resumption of talks presents a crucial opportunity to enhance economic growth, deepen partnerships, promote sustainability, prosperity and progress. With the Philippines among the fastest-growing economies in the region and boasting a young and dynamic population, the potential for mutually beneficial collaboration between the EU and the Philippines is vast,' the ECCP said.

Last Monday, Trade Secretary Alfredo Pascual and European Commission trade commissioner Valdis Dombrovskis said negotiations for the FTA between the Philippines and EU would be restarted.

There have been two rounds of negotiations for the Philippines-EU FTA, with the last one held in 2017.

However, no further negotiations were scheduled after the last round of talks amid the EU's concerns on policies of the Philippine government under the previous administration, including the war against illegal drugs.

The resumption of talks follows a stocktaking exercise conducted by the Department of Trade and Industry and the European Commission from September to December 2023.

Dombrovskis said the positive change of direction taken by the Philippine government under a new administration and recent developments paved the way for the trade talks to resume.

The ECCP said there is urgency to conclude the FTA before the end of the current administration in 2028 considering the impending expiration of the EU Generalized Scheme of Preferences Plus (GSP+) in 2027.

Under the GSP+, the Philippines is able to enjoy duty-free entry of 6,274 products to the EU.

While the EU-Philippines FTA is projected to increase trade by up to 6 billion euros, the ECCP said the deal will not only benefit areas of trade and investment, but also encourage the improvement of economic policies including those specific to e-commerce, digital transformation, intellectual property and procurement.

'Such a deal holds immense potential to spur trade and investment opportunities, improve diversification, increase competitiveness and economic openness, generate better employment prospects, as well as accelerate breakthroughs in innovation and technology,' the ECCP said.

The ECCP added that the Philippines would benefit through increased market access for highly protected sectors such as agriculture and garments.

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