Philippines and EU to finalise landmark free trade deal by 2025
CEBU stands to gain from the Philippines-European Union free trade agreement (FTA), now seen to be finalized this year, EU Ambassador to the Philippines Massimo Santoro said.
"I'm very confident that this is the good year," Santoro said in an interview in Cebu City, citing steady progress in recent negotiation rounds held in both the Philippines and Brussels.
The proposed FTA is expected to unlock wider market access for Philippine goods and services, benefiting exporters in manufacturing, agriculture, and the information technology-business process management (IT-BPM) sector, while also supporting investments in digital and green industries.
The EU and the Philippines officially resumed negotiations for a comprehensive FTA in March 2024 to strengthen bilateral trade and investment. The deal aims to establish a modern and balanced agreement that could unlock export potential estimated at $12 billion for both sides, strengthening ties beyond the current EU GSP+ preference scheme.
"We are revitalizing trade with Europe through the Philippine-EU Free Trade Agreement negotiations, which will open up a market of nearly 450 million high-income consumers," said Foreign Affairs Secretary Ma. Theresa Lazaro in a news report following the fifth round of FTA negotiations in Brussels on March 5.
Cebu to gain from FTA
Santoro said Cebu stands to gain significantly from the agreement, given its strong trade linkages, international connectivity, and growing role as a regional economic hub.
"Cebu is a city where we have a lot of trade relationships... particularly well connected domestically and internationally," he said, noting that major urban centers are likely to be among the biggest beneficiaries of the deal.
Beyond trade, the EU is also expanding its engagement with regions outside Metro Manila, with Cebu increasingly serving as a focal point for cooperation in areas such as the green economy, digital transformation, maritime initiatives, and disaster response.
Santoro pointed out that his repeated visits to Cebu reflect the breadth of EU-Philippines collaboration, including participation in trade negotiations, local government partnerships, and post-disaster support for communities affected by calamities.
In a symbolic move, European diplomats, including Greek Ambassador to the Philippines Ioannis Pediotis, recently held a national day celebration in Cebu-the first time such an event has been staged outside the capital-underscoring efforts to deepen regional ties.
The envoy added that the FTA goes beyond traditional tariff reductions, featuring dedicated provisions on the digital economy and sustainability, including renewable energy, waste management, and circular economy initiatives.
Business groups expect the agreement to enhance the competitiveness of Philippine exports in the European market while attracting more investments into high-growth regions like Cebu.
As negotiations advance, Cebu's emergence as a key node in EU-Philippine relations highlights a broader shift toward more inclusive, regionally distributed economic engagement.
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