Sponsorship Speech: Treaties on EU-PH Framework Agreement on Partnership and Cooperation, and Social Security Agreements with Sweden and Germany

January 16, 2018

Sponsorship Speech of Senator Loren Legarda

Treaties on EU-PH Framework Agreement on Partnership and Cooperation, and Social Security Agreements with Sweden and Germany

16 January 2018 | Senate Session Hall


Mr. President, distinguished colleagues,


I have the honor to seek approval of three treaties, namely:


  • Senate Resolution No. 570 under Committee Report No. 193, “Resolution Concurring in the Ratification of the Framework Agreement on Partnership and Cooperation Between the European Union and Its Member States, of the One Part, and The Republic of the Philippines, of the Other Part”;


  • Senate Resolution No. 571 under Committee Report No. 194, “Resolution Concurring in the Ratification of the Agreement Between The Republic of the Philippines and The Federal Republic of Germany on Social Security”; and,


  • Senate Resolution No. 572 under Committee Report No. 195, “Resolution Concurring in the Ratification of the Agreement on Social Security Between The Republic of the Philippines and The Kingdom of Sweden”.


PH-EU Partnership and Cooperation Agreement


Mr. President,


It has always been in the interest of our country to establish and fortify formal relations with international partners that will protect and improve the welfare of Filipinos here and abroad. Our august chamber has never been remiss in initiating and supporting efforts to achieve this goal.


The Philippines and the EU have long established diplomatic relations since 1964, and this partnership has matured and evolved over the years.


The EU remains to be a robust economic partner of the Philippines. In 2016, our country was ranked as the EU’s 4th largest trading partner, 4th export market, and 5th import supplier. For the first half of 2017, total Philippine merchandise exports amounting to €4.38 billion comprised 14.9% of overall exports to the EU, which made the EU our 2nd largest export partner during this period. Moreover, foreign direct investments (FDIs) from the 28 EU member states represent the largest FDIs in our country, supporting over 500,000 Filipino jobs.


The EU also continues to prove to be a committed development partner. As of June 2017, the EU ranks 4th among sources of grants from official development assistance (ODA) and 8th among the combined sources of loans and grants of ODA.  The EU’s total ongoing ODA portfolio to the Philippines amounts to €190.48 million, comprising of ten grants.


The EU is also a major contributor to the Mindanao Trust Fund (MTF), a multi-donor grant facility that consolidates international development assistance for the recovery of conflict-affected communities in Mindanao; and a committed member of the International Monitoring Team (IMT) in our peacekeeping efforts with the Moro Islamic Liberation Front (MILF).


In addition, the EU is home to an estimated 700,000 to 800,000 of our kababayans. The largest Filipino communities are in Italy, the United Kingdom, and Greece.  The EU is the 3rd largest source of remittances from overseas Filipinos and is the 5th largest source of tourists in Philippines.


Mr. President,


The legal basis of our ties with the EU is still a 37-year old agreement that does not truly reflect this dynamic partnership. It is time that we bring this relationship up to date through the PCA.


The Agreement commits the Philippines and the European Union and its member states to pursue dialogue in 41 areas of cooperation, which include combatting terrorism, human trafficking and illicit drugs; countering the proliferation of weapons of mass destruction, small arms, and lights weapons; protecting human rights; encouraging environmental sustainability; reducing the impact of climate change; promoting development cooperation, and capacity-building and technical cooperation initiatives; and exchange of experts in the areas of science, technology, statistics, food, and drugs.


The PCA will also bolster our status as a beneficiary country under the EU’s Generalised Scheme of Preferences Plus (GSP+) and provide basis for concluding a Free Trade Agreement (FTA) with the EU.  The prospective FTA aims to enhance market access for goods, services, and investments for the two sides, thereby ensuring benefits for our micro, small, and medium enterprises (MSMEs), which comprise 99.5% of total businesses and employ 61.6% of the total workforce in the country.


The PCA allows both Parties to address issues and challenges in a more coherent, efficient, and sustainable manner. It provides an overarching mechanism for formal and regular dialogue between the Philippines and the EU.


Without the PCA, what we currently have is an ad-hoc dialogue in the form of the PH-EU Senior Officials’ Meeting (SOM) and its working groups, which do not meet regularly. Issues of concern to either PH or EU are only discussed in a compartmentalized manner.  Through the PCA, discussions on these issues would take place in an institutionalized mechanism, which will ensure greater coordination between the Philippines and the EU.


In cases of dispute on any of the issues covered by the Agreement, the PCA provides that both Parties shall resort to dialogue through the Joint Committee with the view of seeking a mutually acceptable solution.


The entry into force of the Framework Agreement will not necessitate the introduction of any new legislation as it does not create any new legal commitments, and the language is expressed in general terminologies.


Upon the PCA’s entry into force, a Joint Committee, composed of PH and EU senior officials, will be established. The Joint Committee will set out the priorities within the framework of cooperation, provide recommendations for promoting the objectives of the Agreement, and monitor and oversee the proper functioning of the Agreement.  Each Party may refer to the Joint Committee for any divergence with the application or interpretation of the PCA.


Mr. President,


Given the current realities of our bilateral relations with the EU, the Framework Agreement on Partnership and Cooperation will serve as a solid platform for dialogue to explore ways to achieve our shared goal of a stronger partnership based on mutual respect, trust, and equality.  I, thus, seek the Senate’s concurrence in the ratification of this Agreement.


Social Security Agreements


Meanwhile, Mr. President, the Philippines has also entered into social security agreements with several countries, especially those that host a sizeable number of Filipinos, not only to protect the interest of our kababayans, but also as a way to boost our diplomatic relations with other countries.


Since the early 1980s, the Philippine Government has undertaken negotiations on social security agreements. Among the countries that have signed the Convention on Social Security with the Philippines are Austria, United Kingdom and Northern Ireland, Spain, France, Canada, Quebec, Switzerland and Belgium.


Now, we seek to also approve our social security agreements with Germany and Sweden.


Overseas Filipinos play an important role in sustaining the strength of the Philippine economy. However, many of the countries where our countrymen live and work do not have social safety nets for foreign nationals, thus leaving them in a precarious situation should the need for such safety nets arise. On the other hand, Filipinos who migrate to countries that have coverage for foreign nationals are unable to accumulate enough insurance periods to qualify for full social security pensions because they do not meet the minimum requirement for coverage.


Furthermore, without a social security agreement between the Philippines and the host country, many employers risk the payment of double contributions or dual coverage when sending a worker on a temporary basis to the other country.


Germany is host to more than 21,000 Filipinos. It is also a strong and strategic partner of the Philippines. It ranks as the 11th major trading partner of the Philippines worldwide. In 2016, overall trade between the Philippines and Germany amounted to USD 4.192 billion and the balance of trade was in favor of the Philippines (USD 394.503 million).


New German investments, in particular in the IT-based service sector, are growing. German companies also see the Philippines as a future market in the maritime, transport and industrial manufacturing sectors. In 2016, Investment Promotion Agencies-Approved German investments in the Philippines amounted to Php4.9 billion.


With the Exchange of Notes between the Philippines and Germany on the German-Philippines Chamber of Commerce and Industry (GPCCI) on 23 September 2015, officially admitting the same as part of the German Chamber Network, German nationals are expected to invest and relocate to the Philippines.


Thus, the Philippines-Germany Social Security Agreement, which was signed by both Parties on 19 September 2014 in Berlin, Germany, is seen as beneficial to both countries as it will provide greater impetus towards the promotion of the Philippines as a retirement haven for qualified German pensioners under the Philippines Retirement Act, and will also ensure that Filipinos living and working in Germany are covered with social security benefits.


Meanwhile, among the Nordic countries, Sweden is our largest trading partner and the ninth largest among the European Union (EU) Member States. Bilateral trade between the Philippines and Sweden in 2016 amounted to US$ 134.29 million, slightly down from the US$ 143.40 million total trade registered.


But despite the downturn in trade, Sweden remains confident in the Philippines given our consistent strong economic performance. Many Swedish companies have also established a presence in the Philippines.


A most solid illustration of Sweden’s confidence in the Philippine economy is the visit to Manila in November 2016 of a 70-member Swedish business delegation headed by Swedish Minister for Enterprise and Innovation Mikael Damberg, who also presided over the re-opening of the Swedish Embassy in Manila.


The Philippines-Sweden Social Security Agreement was signed in Stockholm, Sweden, on 15 October 2015.


Both the social security agreements with Germany and Sweden contain standard provisions consistent with International Labour Organization (ILO) Convention 118 on the Equality of Treatment and ILO Convention 157 on the Maintenance of Social Security Rights.


These Agreements aim to contribute to equality of treatment, allow the portability of benefits to overseas Filipinos and nationals of the host country, and improve the processing of claims while eliminating dual coverage, among others.


Mr. President,


We must pursue initiatives that will help uplift the lives of our overseas workers and help secure their retirement in their twilight years.


It is, thus, my hope that the Senate concurs in the ratification of the Social Security Agreements with Germany and Sweden, as we actively pursue similar social security agreements with other countries that have compatible social security schemes with the Philippines and home to most number of Filipino workers.


Thank you, Mr. President.