EU, Philippines Could Begin FTA Negotiations Early Next Year

The Philippines

Officials from the Philippines are pursuing a free trade agreement with the European Union and hope to launch negotiations in early 2016.

EU pork and pork variety meat exports to the Philippines surged in 2014 following closure of the Russian market, with volume nearly doubling from the previous year to 163,287 metric tons (mt). In 2015 (through September), EU exports are down about 10 percent from a year ago but still 67 percent above their 2013 pace.

The Philippines imposes fairly low duties (5 to 10 percent) on pork variety meat, but duty rates on imported pork muscle cuts are as high as 40 percent. Through October, the Philippines was the seventh-largest destination for U.S. pork/pork variety meat exports in both volume (30,238 mt, -11 percent from a year ago) and value ($67.9 million, -27 percent).

At 10 percent, the duty rate for imported beef muscle cuts entering the Philippines is much lower than for pork. The rate is 7 percent for most beef offal and 5 percent for livers. Although it is a much smaller destination for EU beef/beef variety meat, EU exports to the Philippines in 2015 (also through September) have more than doubled from a year ago to 8,048 mt (+125 percent and now eighth-largest among international markets for EU beef), most of which is from Ireland. Through October, U.S. beef/beef variety meat exports to the Philippines totaled 10,486 mt (-3 percent from a year ago) valued at $54.9 million (+9 percent).

“In the Philippines, more so than in almost any other Asian market, price is an extremely important factor in determining which supplier captures market share,” noted Joel Haggard, USMEF senior vice president for the Asia Pacific region. “With the Philippines maintaining significant duties in imported meat – and especially on pork muscle cuts – there is certainly potential for European suppliers to gain a price advantage if duties are lowered through an FTA.”

Data source: Global Trade Atlas