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No quota under proposed JPEPA

Manila Bulletin, 27 June 2005

No quota under proposed JPEPA

Japan open to IT, medical workers


The Japanese government is considering the position of the Philippines that there should be no quota and volume limit on the entry of Filipino IT and medical professionals to Japan but rather the entry of Filipino labor to Japan be driven by demand and qualification.

Trade and Industry Secretary Juan B. Santos said the government has relayed this position explicitly to the Japanese panel as both parties continued to hammer out the remaining three issues of movement of natural persons, automotive and dispute settlement as negotiations for the Japan-Philippines Economic Partnership Agreement (JPEPA) enters its last leg.

Negotiations are expected to be completed in September and signing of the free trade deal pact by end this year.

"They are considering and beginning to understand our position and in fact offered some grants to train and develop our engineers," Santos said.

The Japanese, which spearheads the conduct of standards and qualifications for computer programmers, even plans to expand the conduct of tests to the provinces and not just in Manila.

Initially, the Japanese side dangled an allowable quota of 100 Filipino laborers annually to enter Japan. This was raised later raised to 180 professionals a year.

"That is unacceptable to us. What we want is unlimited and no quota and the entry of Filipino IT and medical professionals to Japan must be driven by demand and qualification," Santos said.

Santos further said the Philippines should be part in the formulation of parameters on the qualifications of workers.

Part of the qualifying factors would be language proficiency, but Santos said that Filipinos are able to hurdle the language barrier easily.

On the automotive sector, the Philippines has reopened negotiations specifically for this sector as the government would rather adopt a "sudden death" approach rather than the gradual tariff reduction in the automotive trade.

A source privy to the ongoing bilateral talks stressed that the reopening of negotiations for the automotive sector was necessary to ensure that the domestic automotive and automotive components sector are amply protected.

The Philippines noted that while Japan was open to a sudden death approach on automotive trade with its ongoing economic partnership agreements negotiations with other ASEAN countries, the proposed JPEPA was a different one and this might put the Philippine industry at a disadvantage.

At present, the Philippines imposes a 30 percent tariff on completely builtup (CBU) motor vehicles and under the proposed JPEPA this would be reduced over time reaching zero by 2010.

But its proposed EPA with Malaysia has called for twice reduction only of tariffs in 2008 and 2010.

On the issue of dispute settlement, the Philippines is still completing a review of its dispute settlement mechanism.

Foreign affairs Undersecretary Edcel Custodio said stressed that all trade agreements contain provisions on dispute settlement.

"We are reviewing our dispute settlement mechanisms for our protection," Custodio said.

Custodio said the Philippine side is "cleaning up the legal text to avoid any problem in the future."

It can be recalled that the government ran into problems on the Philippine International Air Terminals Corp., which is partly owned by a German investor.

 source: Manila Bulletin