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NGO coalition bucks free trade talks with Japan

NGO coalition bucks free trade talks with Japan

By Rocel C. Felix

The Philippine Star 05/11/2005

A coalition of non-government organizations is opposing the free trade talks under the Japan-Philippines Economic Partnership Agreement (JPEPA) saying the Philippines would wind up as the losing party if the deal pushes through.

Stop the New Round Coalition (SNR) spokesperson Joseph Purugganan said the JPEPA, a comprehensive bilateral economic agreement is expected to be completed and signed this July with both parties silent on the pressing issues being raised by parties questioning the agreement.

"JPEPA covers all key economic activities and surpasses the scope of current World Trade Organization (WTO) negotiations, which is still limited to the issue of trade in goods.

"We oppose JPEPA because it imposes a blanket liberalization of trade in goods, investments and services that opens up our national economy and patrimony to Japanese economic invasion," said Purugganan.

He said Japan’s obvious interest to penetrate the local market for its industrial products and its investments and services in energy infrastructure, construction and government procurement would prejudice Filipino-owned industries and enterprises.

"For one, the Philippine government will lose badly-needed revenues since JPEPA calls for a short period of 0-10 years in which to complete tariff elimination in almost all traded goods between the two countries," Purugganan said.

Moreover, tariff elimination in industrial products will jeopardize the local steel and car assembly industries.

"JPEPA prescribes the removal of all barriers to trade in services, investments and government procurement, three economic areas or issues not even covered yet under current WTO negotiations," said Purugganan.

SNR is also concerned about the Japanese negotiating team’s insistence that the Philippine Constitution be amended to allow full foreign control of enterprises and property ownership.

"Even though our government negotiators have not yet given in to this demand, they have nevertheless agreed to enhance investment opportunities and strengthen protection for investors and investments. This could be used later to justify amendments to the Constitution," said Purugganan.

Japan is also proposing that investments should extend to economic activities in the Exclusive Economic Zone such as the country’s marine waters and resources stretching up to 200 kilometers from its outermost islands.

At the same time, under the area of cooperation, the entry of investments from small and medium enterprises (SME) will be facilitated in both countries.

"But it’s a fact that Filipino SME are much weaker than their Japanese counterparts and could hardly penetrate the Japanese market. This could dislocate and wipe out the weaker local SMEs," Purugganan said.

SNR is asking the Philippine government to be more upfront about the JPEPA talks, adding that the secrecy is harboring suspicions that the Philippine panel might be giving concessions detrimental to the local industries affected.

The JPEPA talks already reached the fifth round of talks late last year, with both parties saying discussions reached a delicate stage but have kept mum about thorny issues that have stalled discussions, especially on agriculture.

Several groups voiced their concern over talks of a trade-off between the agriculture and industrial sectors amid Japanese demands to open up the domestic market to Japanese industrial goods in exchange for freer access of Philippine agricultural goods in Japan.

The Department of Agriculture (DA) is pushing Japan to open up its agricultural market. Currently, it is one of the Philippine’s biggest market for its agricultural exports.

The government’s goals is to gain better market access through reduction if not outright elimination of tariffs for agricultural products since Japan is already a leading importer of shrimp, seaweed, tuna and crabs.

Japan on the other hand, wants the Philippines to open up its industrial sector but insists on excluding 790 agricultural products such as rice, bananas, sugar, pineapple, leather and leather products.

 source: Philippine Star