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KMU sees more retrenchment with new RP-Japan trade pact

Inquirer | Manila | 09/13/2006

KMU sees more retrenchment with new RP-Japan trade pact

By Jerome Aning

MANILA — The militant labor group Kilusang Mayo Uno (KMU) said Tuesday it fears more retrenchments and lower wages with the impending liberalization of the country’s automotive and steel sectors under the recently signed Japan-Philippines Economic Partnership Agreement (JPEPA).

KMU chairman Elmer Labog said although the free trade agreement will increase Japanese direct investments in the Philippines, Japanese firms would still continue to import most of their inputs and components from Japan.

"Moreover, export enclaves that promote cheap and unorganized labor will proliferate, hindering workers’ rights to organize," he explained, referring to the practice of locating foreign-invested firms in the so-called economic zones.

Under the new accord, import tariffs on industrial goods will decrease by 90 percent within 10 years, tariffs on Japan-made cars will be eliminated by 2010, and tariffs on steep imports will be reduced by 60 percent.

According to the labor leader, the liberalization of other aspects of the economy would also result in massive retrenchments.

Some of these include the elimination or reduction of tariffs on industrial products and agriculture, forestry and fishery products ; and the loosening of controls in service sectors such as construction, outsourcing, air transport, health related and social services, tourism and travel-related services, maritime transport services, telecommunications and banking.

Labog said he doubted whether provisions on dispute avoidance and settlement under the FTA would be really followed, as he cited the experience of the independent union Toyota Motors Phils. Corp. Workers’ Association (TMPCWA).

TMPCWA started organizing in 1998 and eventually won a certification election in March 2001. On March 16 of the same year, the Labor department affirmed that TMPCWA is the sole and exclusive collective bargaining agent. However, on the very same day, the company terminated 227 union officers and members.

Labor said that despite a decision of the Supreme Court and the recommendations of the International Labor Organization, the Toyota management continued to refuse to recognize the union and negotiate a CBA.

 source: INQ7