PHP, EFTA sign free trade agreement

by Victor S. Saulon, Businessworld, April 30, 2016

THE Philippines and the European Free Trade Association (EFTA) signed a free trade agreement on Thursday after concluding two months ago the negotiations over a deal that is expected to boost the country’s strategic trade and economic partnership.

Trade Secretary Adrian S. Cristobal Jr. said in an e-mail message sent by his staff that the free trade agreement (FTA) represented an important step in further strengthening the Philippines’ relationship with EFTA members Iceland, Liechtenstein, Norway and Switzerland.

THE Philippines-EFTA agreement covers a wide range of areas, including trade in goods such as industrial and agricultural products, fish and other marine goods, rules of origin, and trade facilitation.

The FTA’s coverage includes sanitary and phytosanitary measures, technical barriers to trade, trade in services, investment, competition, protection of intellectual property rights, government procurement, and sustainable development.

Henry Schumacher, external affairs vice-president of the European Chamber of Commerce of the Philippines, said via e-mail that his group was “delighted” that the FTA had been signed, which he said underlined “the interest of the Philippines to do more business with Europe in both directions.”

“We are looking forward to an FTA between the Philippines and the EU [European Union] as the next step,” he added.

The trade department said a joint committee would oversee the implementation of the FTA, which will enter into force after completion of the necessary internal procedures for ratification by the trading parties.

Negotiations for the FTA were launched in March last year after the parties signed a joint declaration on cooperation in the Westman Islands, Iceland in June 2014. Talks were concluded in February this year.

The Department of Trade and Industry (DTI) said the preferential market access and the rules and disciplines governing the economic relations between the Philippines and EFTA under the agreement will supplement the economic cooperation and exchange in the joint declaration. As a result, the deal provides “a stronger stimulus for the further development of trade and investment.”

Merchandise trade between the country and the EFTA states has expanded at an annual rate of 11% from 2005 to 2015. Last year, goods traded between them reached $863 million. EFTA exports to the country were valued at $407 million while the Philippines’ shipments amounted to $456 million.

During the period, EFTA’s exports to the Philippines were pharmaceuticals, clocks and watches, and machinery while EFTA’s imports were precious metals, electrical machinery, and medical instruments.

The Philippines-EFTA free trade agreement was signed by Mr. Cristobal and Switzerland President Johann N. Schneider-Amman, Iceland Ambassador Martin Eyjûlfsson, Liechtenstein Minister of Foreign Affairs Aurelia Frick and Norway State Secretary of the Ministry of Trade, Industry and Fisheries Dilek Ayhan.

Mr. Schneider-Amman is also head of Switzerland’s Federal Department of Economic Affairs, Education and Research.

Separately, the DTI said the second meeting of the Joint Economic Commission (JEC) between the Philippines and Switzerland was convened on April 27 in Berne, Switzerland, and was co-chaired by DTI Undersecretary Nora K. Terrado and Swiss Ambassador Livia Leu.

Ms. Leu is head of Bilateral Economic Relations, State Secretariat for Economic Affairs, Federal Department of Economic Affairs, Education and Research of the Swiss Confederation.

The DTI said the talks focused on the FTA between the country and the EFTA states, the Philippines’ bid to become a priority country for the Swiss Import Promotion Program, regional and multilateral economic issues, the implementation of existing bilateral agreements as well as the perspectives of the private sector in relation to the domestic developments of both countries.

“The JEC between the Philippines and Switzerland fully complements and enhances the PH-EFTA Free Trade Agreement allowing both countries to create an environment conducive for our private sector to seize the benefits,” said Ms. Terrado.

The trade department said discussions on the FTA “focused on the broader market access of the Philippines in Switzerland through the FTA and the activities proposed to be undertaken as part of the communications plan to promote and advocate the FTA in the Philippines and Switzerland.”

The joint commission — a venue to discuss trade, investment and economic cooperation — seeks to forge closer bilateral trade and investment ties between the two countries. It also aims to promote sound business-to-business cooperation. —