European Commission President Ursula von der Leyen announced on Tuesday that the EU and the Philippines have agreed to a free trade deal. The agreement aims to deepen trade ties and strengthen the EU's strategic engagement with the Indo-Pacific region.
The agreement is expected to deepen trade ties between the EU and the Philippines, a significant market in the growing Indo-Pacific region, and supports the EU's broader strategy of building trade frameworks with ASEAN nations.
The European Commission and the Philippines have agreed to a free trade deal, as announced by European Commission President Ursula von der Leyen on Tuesday. This agreement signifies a deepening of trade ties between the EU and the Philippines, a key partner in the Indo-Pacific region, aligning with the EU's Indo-Pacific Strategy.
Negotiations for an EU-Philippines trade and investment agreement were initially launched in December 2015, with subsequent rounds in February 2017, but talks were later put on hold. In July 2023, both parties announced their intention to assess conditions for resuming negotiations, leading to the official resumption of talks in March 2024. The EU aims for a comprehensive and modern Free Trade Agreement (FTA) that includes ambitious market access for goods, services, investment, and government procurement, alongside provisions for digital trade, energy, raw materials, sustainable food systems, and intellectual property protection. Crucially, the FTA will include robust and enforceable disciplines on trade and sustainable development, supporting high standards for workers' rights, environmental protection, and climate goals.
A Sustainability Impact Assessment (SIA) has been conducted to evaluate the potential economic, social, human rights, and environmental impacts of the future FTA. The EU sees bilateral agreements with ASEAN countries, including the Philippines, as building blocks towards a future region-to-region agreement with ASEAN. In 2025, the EU was the Philippines’ fourth-largest trading partner, accounting for 8.3% of its total trade in goods, while the Philippines was the EU’s 38th largest trading partner. Bilateral trade in goods reached €17.6 billion in 2025, with a deficit for the EU of €1.4 billion. Total trade in services amounted to €10.3 billion in 2024, with a surplus for the EU of €0.7 billion. The stock of EU foreign direct investment in the Philippines was €15.4 billion in 2024, while Philippine FDI in the EU was €2.4 billion.
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