Manila Bulletin | 13 August 2007
Is JPEPA an executive agreement?
By BERNIE CAHILES-MAGKILAT
Despite the submission of the Japan-Philippines Economic Partnership Agreement (JPEPA) for Senate ratification, some quarters are of the opinion that under the Tariff and Customs Code this bilateral economic deal can be considered an executive agreement and therefore does not need Senate ratification.
Section 401-402 of the Tariff and Customs Code, an industry official pointed out, there is no need for the JPEPA to be ratified by the Senate. But the JPEPA has been submitted as a priority bill in the Senate.
Section 401 of the Tariff and Customs Code provides for flexible tariff wherein the President is authorized to modify tariff rates as the need arises based on the recommendation by the National Economic and Development Authority (NEDA) and after a determination by the Tariff Commission.
Section 402 of the same Code, which deals on the promotion of foreign trade, is more specific in granting flexibility to the President to enter into trade agreements with foreign governments or modify import duties to expand the country’s foreign trade as a "means of assistance in the economic development of the country, in overcoming domestic unemployment, in increasing the purchasing power of the Philippine peso, and in establishing and maintaining better relations between the Philippines and other countries..."
The President must also be advised by relevant government agencies on the impact of forging such trade agreements on its impact to domestic industries, Section 402 states.
Trade and Industry senior undersecretary Thomas G. Aquino, on the other hand, said that since the Department of Foreign Affairs (DFA) has already said that it has to go through the Senate for ratification then so be it.
"My job is to negotiate, if the instruction is that it needs Senate ratification then it has to go through that process," Aquino said grudgingly.
Aquino said that under the process an Executive Order would still have to be issued after the Senate ratification and an implementing rules and regulations.
"It is not a single document, it is not only tariff but also services," he said.
"There’s also a judgment that it’s going to affect other policies not only tariff," Aquino added.
There is apprehension though that the Senate may not ratify the JPEPA and if it does, the process may take longer than expected.
On the other hand, the government is pressed for time to implement the accord otherwise the advantages and economic benefits the Philippines is supposed to gain from the deal would become moot and academic as other regional and bilateral trade deals are going to take effect by 2010 including the Common Effective Preferential Tariff in ASEAN and the ASEAN-China free trade agreement.
The ASEAN is also forging a free trade deal with Japan.
The JPEPA calls for zero tariffs on almost all industrial products traded by both countries within 10 years upon effectivity of the accord.
Trade and Industry Secretary Peter Favila had been defending JPEPA as a harbinger of economic growth for the Philippines, contrary to what its opponents claim would open the floodgates to the dumping of Japan’s toxic waste in the country.
He said the trade agreements between Japan and the three Asian countries, Malaysia, Thailand and Singapore, contributed significantly to the increase in their gross domestic product (GDP) and the same could happen to the Philippines if the agreement is ratified by the Senate.
Favila said the JPEPA envisages the lifting of tariff on almost all industrial goods within 10 years upon the effectivity of the accord.
One benefit to the Philippines is its assurance of non-discriminatory treatment of Filipino professionals working in Japan.
It also establishes a formal arrangement for the acceptance of Filipino nurses and caregivers to Japan.
Favila said the JPEPA would bring immediate and long-term benefits to food processors, farmers and fishersfolk.
The JPEPA was signed by President Arroyo and former Japanese Prime Minister Junichiro Koizumi on the sidelines of the 6th Asia-Europe Meeting (ASEM) in September last year in Helsinki, Finland.