The Philippines could soon join Bosnia, Herzegovina and Sri Lanka in having open access to the EU market if it is prepared to bind the tariff rates on its apparel products.

This latest EU proposal improves on an earlier one that asked the Philippines to reduce tariffs on certain garments in exchange for a higher export quota.

Binding its tariff rates means that the Philippines can lower its tariffs but cannot raise them above the set rate. At present, the Philippines' bound rate for apparel is at 36 per cent although the applied (actual) rate is only 20 per cent.

According to Trade and Industry Secretary Manuel A Roxas II: "The idea to enter into this bilateral textile agreement appealed to the government since every year the Philippines has to negotiate for the traditional increase in quota allocation from EU."

If the country is prepared to go along with the EU proposal, Philippine manufacturers could make some headway into the EU market and establish contacts with the buyers before the quota system ends in year 2005.

Consultations with trade bodies such as the Textile Manufacturers Association of the Philippines, Garment Business Association of the Philippines and the Confederation of Garment Exporters of the Philippines, as well as representatives from the local industry, are ongoing.

Last year, Philippine garment exports reached $3.3 billion, over 60 per cent of which come from the quota markets such as EU, the US, and Canada.