On 1 March 2018, the Partnership and Cooperation Agreement (PCA) between the EU and the Philippines entered into force. The Agreement provides an enhanced legal framework, enabling the European Union and the Philippines to strengthen their bilateral relationship, in particular on political, social and economic matters. 

Prior to the PCA, ministerial and senior official level contacts were held regularly on economic and political issues of common interest. 

The first EU-PHILIPPINES Joint Committee  (the highest governance body under the PCA) met in Brussels on 28 January 2020. The Joint Committee allows the Philippines and the EU to develop the full potential for cooperation in different sectors with a view to raising the bilateral relationship to a higher level and strengthening ties based on mutual interest and respect.  The next Joint Committee should meet in 2021 in Manila. 

The Joint Committee established three specialized subcommittees: on Development Cooperation, on Trade, Investment and Economic Cooperation and on Good Governance, Rule of Law and Human Rights. The first subcommittee on Trade, Investment and Economic Cooperation took place on 29 January 2021. Meanwhile, the first Sub-Committee on Good Governance, Rule of Law and Human Rights met on 5 February 2021 and on 6 October 2022.  The first Sub-Committee on Development Cooperation met on 19 April 2021, the second on 23 November 2022 and the third meeting was conducted  on 21 November 2023. 

The second Joint Committee met in Manila on 26 April 2022 and reviewed the implementation of the EU-Philippines Partnership and Cooperation Agreement. A broad range of topics including the current situation in the Philippines and the EU, sectoral cooperation in a number of areas, and geopolitical developments in Asia and Europe were also discussed. The Joint Committee was debriefed and updated on the Subcommittees held in 2021and agreed on strengthening cooperation on maritime issues. The meeting reviewed the multifaceted aspects of the bilateral relationship. The third EU-Philippines Joint Committee will be held in Brussels in the first quarter of 2023. The three sub-committees will be held in Manila prior to that.

The EU has been a staunch supporter of the Mindanao Peace Process throughout the years and welcomed the peaceful conduct of the referendum in early 2019. The EU remains committed to supporting the Bangsamoro Autonomous Region in Muslim Mindanao (BARMM) through its different instruments. 

The EU Human Rights and Democracy Country Strategy (2021-2024) for the Philippines focuses on the following areas of concern:  

• Fighting impunity, promoting accountability rule of law, including the support to an evidence-based approach to the fight against illegal drugs. 
• Strengthening the civic and democratic space.
• Support freedom of expression online and offline, access to information and fight against disinformation. 
• Rights of the child. 
• Eliminating inequalities, fighting discrimination and empowering women and indigenous peoples. 

EU Action Plan on Human Rights 

The Council of the EU has adopted on 19 November 2020 the EU third EU Action Plan on Human Rights and Democracy (2020-2024) which provides for a renewed political roadmap that sets the priorities for positioning the EU as a geostrategic and credible global actor seeking to defend EU values and interests.  

In May 2024, the EU High Representative for Foreign Affairs and Security Policy presented the 2023 EU Annual Report on Human Rights and Democracy in the World.  

The EU continues to engage with its partners, including the national and regional Commissions on Human Rights (CHR), state actors (Department of Justice, Department of Interior and local governments, Department of Foreign Affairs and Presidential Human Rights Committee Secretariat), human rights defenders and civil society. 

As part of the EU support to human rights defenders in the Philippines, the delegation has translated the European Union Guidelines On Human Rights Defenders into eight local Philippine languages - (Hiligaynon, Cebuano, Tagalog, Ilokano, Meranaw, Bicol, Kapampangan and Waray/Leyte). 

TRADE

The EU ranked as the Philippines' fourth largest trading partner, while the Philippines was the EU's sixth largest trading partner in the Association of Southeast Asia Nations (ASEAN) in 2022. Trade in goods between the two partners equaled € 18.4 billion in 2022, exceeding pre-pandemic levels. The Philippines enjoyed a trade surplus of € 3 billion in that year. Trade in services between the EU and the Philippines reached € 4.7 billion in 2021. (More statistics on the Philippines). The Philippines remain a prime location for Business Process Outsourcing (BPO) for European companies.

The Philippines continues to benefit from the GSP+ trade preference with a utilization rate of 77% in 2022. 26.5% of total Philippine exports to the EU (over 2 billion euros) enjoyed preferential treatment under the GSP preferential trade preference. 

In 2021, the EU share in the total trade of the Philippines was around 8% 

Top products traded between the EU and the Philippines are dominated by machinery and transport equipment; chemicals, food products and electronic components. Office and telecommunication equipment and machinery, in particular integrated circuits and electronic components are the strongest export product of the Philippines to the EU but growth in other sectors can be noted thanks to the GSP+-preferences, notably in agricultural products. 

European companies have been long time investors in the Philippines, providing jobs and know-how and contributing to the growth of the country. EU foreign direct investment stocks were € 14 billion in 2021.

EU’s Generalised Scheme of Preferences Plus (GSP+).  

Since 25 December 2014, the Philippines has enjoyed enhanced trade preferences with the EU under the EU’s Generalised Scheme of Preferences Plus (GSP+). Before that, the Philippines was a beneficiary of the standard GSP scheme. The special incentive arrangement for Sustainable Development and Good Governance GSP+ grants full removal of tariffs on two thirds of all product categories, aiming to support sustainable development and good governance. 

GSP+ beneficiary countries are required to respect a number of international conventions in the areas of human rights, good governance, labour rights and environmental protection. In order to ensure compliance with such principle the EU commission conducts periodic monitoring in the countries and publishes country-specific reports. Latest GSP+ published report (2022).  .  

EU-Philippines Free Trade Agreement. 

On 18 March 2024, the EU and the Philippines officially announced the resumption of negotiations for an ambitious, modern and balanced free trade agreement (FTA) – with sustainability at its core. Trade agreements such as these are a cornerstone of the EU's economic security, opening new opportunities for businesses and consumers, strengthening supply chains and promoting sustainable trade practices. An FTA with the Philippines, a booming economy of 115 million people in the heart of the strategically important Indo-Pacific region, would therefore be a valuable addition to the EU's network of trade deals.

Trade-related technical assistance.  

The trade strategy "Trade for All" was adopted in 2015 and aims to transform trade to make it more responsible and beneficial "for all."  

One of the aims of the EU is to ensure that economic growth goes hand in hand with social justice, respect for human rights, labour rights and environmental, health and consumer protection. The EU has been leading in integrating sustainable development objectives into trade policy and making trade an effective tool to promote sustainable development worldwide. The importance of the potential contribution of trade policy to sustainable development was reaffirmed in the 2030 Agenda for Sustainable Development. 

The EU’s Aid for Trade Strategy helps partner countries better integrate into the global trading system and to use trade to help eradicate poverty in the context of sustainable development. 

The EU is a firm supporter of the WTO, which lays down a set of rules to help open up global trade and ensure fair treatment for all participants. 

The Philippines is fully committed to multilateral trade arrangements and to the liberalisation of its trade and economy. However, there are a number of technical issues which have prevented the country from taking full advantage of global trade opportunities. 

The EU started its first Trade Related Technical Assistance (TRTA) in 2005 with a grant of €3.5 million. After two more phases of TRTA, a new programme was recently concluded entitled Association of Southeast Asian Nations (ASEAN) Regional Integration Support – Philippines Trade-Related Technical Assistance (ARISE Plus – Philippines). ARISE Plus – the Philippines contributes to the integration of the Philippines’ economy into the global production chain, through targeted support to both the public and private sectors. It is the national Philippines component of the ARISE Plus Programme, supporting regional economic integration and trade in the ASEAN. ARISE Plus – the Philippines is a five-year programme with a budget of €6.4 million. 

Technical assistance on sanitary and phytosanitary (SPS) measures is also extended to improve and strengthen the SPS framework to allow better production, processing and trade of safe food, healthy animals and plants.

The Philippines is a lower middle-income country that comprises over 7,000 islands and has a population of about 110 million. The Philippines does relatively well on education, life expectancy and GNI per capita. The Philippines shall continue its inclusive growth path, building on its gradual transformation to one of the region’s best performing economies sustaining an average annual growth of 6.3 per cent. While the foundations for economic growth are in place, there are challenges to elevating the economic status of the poor.  Poverty declined from 26.3 per cent in 2009 to 21.9 per cent in 2018. It was expected to decline to 19.8 per cent in 2020 before the irruption of the Covid-19 pandemic. Rural poverty, however, remains high. Despite gender equality regulations, the Philippines still face high gender inequality in the labour force participation and limitations in the reproductive health sector.

The main challenge for the Philippines to accomplish is its Philippine Development Plan 2017-2022 (PDP), a medium term strategy for poverty reduction and achievement of the SDGs, is to make growth more inclusive and to accelerate job creation by increasing investments particularly in infrastructure, better governance and by improving the business environment including better business services. 

The EU's support to the Philippines currently focuses on governance, job creation, renewable energy, and assistance to vulnerable populations, specifically in Mindanao which is the poorest region of the Philippines and has been affected by conflicts and population displacement. The EU remains one the biggest foreign development partners in support of Mindanao and the Peace Processes through a comprehensive approach targeting directly the political settlement with the Instrument contributing to Stability and Peace and longer term development mainly through the Development Cooperation Instrument. 

EU development assistance is closely aligned with the PDP. The Plan provides a framework that allows the EU to align its development cooperation programmes with Government policies and programmes with clear leadership and ownership on the part of the Philippine authorities. 

In December 2021, the EU approved its Multiannual Indicative Programme for the Philippines for 2021-2027. The document allocates  EUR 147 million to fund programmes in two main areas of intervention:  Resilient Green Economy and Green Jobs, and Peaceful and Just Society and Good Governance. With this new cooperation strategy, the EU gives continuity to its already long-term engagement in the Philippines on Governance and Peace initiatives, but also choses to support the country in its strategic decision to move towards more a more environmentally-sustainable and resilience-oriented economic development, which is indeed in line with the EU’s own priority to address the environmental challenges our world is facing.

Most of the EU funds are given as grants making the EU jointly with the EU Member States, the largest grant donor in the Philippines.

Bilateral EU-Philippines development cooperation is complemented by projects financed through regional and thematic programmes and instruments that are often implemented by civil society organisations addressing social issues, environment, indigenous people rights, human rights, local governance, peacebuilding, and migration. 

In addition, the EU is one of the most important donors to support the Philippines in cases of serious natural disasters which require emergency aid, such as after super-typhoon Odette.

EU and the Member States, acting as Team Europe Philippines are continuously working with various stakeholders to mitigate the impacts of Covid-19 and to respond to immediate needs.

The impact of EU’s development cooperation in the Philippines:

•        EU’s support to the Health Sector through budget support programmes (closed in 2018) significantly contributed to the country's goal of achieving Universal Health Care and to strengthening the confidential, voluntary and evidence-based treatment of drug-dependent persons.

•        The EU contributes to the national electrification policy through the electrification of 100,000 households with innovative renewable energy solutions coupled with livelihood activities.

•        In the justice sector, EU’s support contributes to the curtail of backlog in courts, the reduction of prosecution services and the improvement of case management with a focus on “justice zones”.

•        EU's comprehensive support to the Bangsamoro peace process facilitated the passing of the Bangsamoro Organic Law and its ratification by the population.

Bilateral EU-Philippines development cooperation is complemented by projects financed through regional and thematic programmes and instruments that are often implemented by civil society organisations addressing social issues, environment, indigenous people rights, human rights, local governance, peacebuilding, and migration. 

In addition, the EU is one of the most important donors to support the Philippines in cases of serious natural disasters which require emergency aid, such as after super-typhoon Haiyan. 

EU and the Member States, acting as Team Europe Philippines are continuously working with various stakeholders to mitigate the impacts of Covid-19 and to respond to immediate needs. 

The impact of EU’s development cooperation in the Philippines: 

• EU’s support to the Health Sector through budget support programmes (closed in 2018) significantly contributed to the country's goal of achieving Universal Health Care and to strengthening the confidential, voluntary and evidence-based treatment of drug-dependent persons. 
• The EU contributes to the national electrification policy through the electrification of 100,000 households with innovative renewable energy solutions coupled with livelihood activities. 
• In the justice sector, EU’s support contributes to the curtail of backlog in courts, the reduction of prosecution services and the improvement of case management with a focus on “justice zones”.
• EU's comprehensive support to the Bangsamoro peace process facilitated the passing of the Bangsamoro Organic Law and its ratification by the population.