The Philippine garment industry is preparing to petition the European Commission, asking it not to consider calls for the country to lose its Generalised Scheme of Preferences Plus (GSP+) access to European Union (EU) markets.
The call follows a resolution adopted by the European Parliament in late-September calling on the European Commission to temporarily withdraw Philippines access from the scheme because of human rights abuses.
MEPs acted over what it regards as “the seriousness of the human rights violations” committed by the administration of President Rodrigo Duterte, who infamously encouraged extra-judicial killings of suspected drug dealers.
Access to GSP+ can be suspended if a country breaches a wide range of human rights conventions – such concerns, for instance, led to Sri Lanka losing this status in 2010 (it was restored in 2017).
Speaking to just-style, Robert Young, trustee for the textiles, yarns and fabrics sector of the Philippine Exporters Confederation Inc. (PHILEXPORT) and the president of the Foreign Buyers Association of the Philippines (FOBAP) said the clothing sector would resist a loss of GSP+ status.
It was planning a communique to the European Commission, which would have to propose such a move. FOBAP will also request an easing of origin rules that have prevented the Philippine clothing sector from making the most of this trade status, Young added.
The industry lacks local backward linkages, preventing it from purchasing enough fabrics and yarns locally that will help qualify it for GSP+ privileges.
“It is heartbreaking to see that garment-makers have no way of replacing imported inputs with locally-made inputs, and we are thus preparing a petition for the EU Commission,” said Young.
The GSP+ program grants the Philippines the benefit of exporting more than 6,000 products to any of the 27-EU member countries at zero tariff. Products on the list include textiles, garments, headwear, footwear, furniture and chemicals.
Young said the Philippines only exported apparel worth EUR100 million to the EU market in a 2019, a performance that it needs to improve to better cope with the Covid-19 pandemic.
Latest data by the Philippine Statistics Authority paint a bleak picture, with industrial output of the country’s apparel and footwear sector and apparel volume-wise dropping by 35.7% year-on-year in August, much deeper than overall industrial output’s contraction of 13.8%. Textile output declined by 25.1% – which would impede the clothing sector’s ability to meet local input rules associated with GSP+.
A European Commission spokesperson suggested that the EU executive was open to suggestions on resolving the concerns over GSP+ and improving its operation. She told just-style the Philippines is “engaging constructively” in the GSP+ monitoring process, which will be followed up on in the next joint monitoring mission to the Philippines planned by the Commission and the European External Action Service, when Covid-19 conditions allow.
“The EU’s current policy focuses on actively pursuing the GSP+ monitoring process, i.e. an open dialogue with the Philippines on our areas of concern and how to progress to alleviate these concerns, rather than to initiate a process to withdraw GSP+ preferences,” the spokeswoman said.
“During the current pandemic we also pursue our broader dialogue through all possible means,” she added, noting that the services’ High Representative Josep Borrell discussed the potential trade problem with [Philippines] foreign minister Teodoro Locsin at a virtual ASEAN (Association of Southeast Asian Nations) – EU ministerial meeting in September. — Jens Kastner, International News Services