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Friday, September 02, 2005
Espinoza: Forging ties with the United States
By Fred C. Espinoza
IDEAL. It’s good to know that the Philippines is preparing to forge closer economic ties with the United States (US) through a possible free trade agreement (FTA). Although businessmen welcome the opportunity, an assurance from the government that our policy-makers and President Gloria Arroyo’s trade negotiators, most especially, are going to keep both eyes wide open in ushering the country into the global free trade arena, would be most ideal for the people this time around.
No doubt, Philippine Chamber of Commerce and Industry president Donald Dee had this thought in mind when he urged the government to determine what our country wants and needs “before Filipinos can benefit from any international treaty that the government will enter into.”
It would do well for Dee and his negotiating team not to let their guard down this time, even if we know for a fact that the US is now the second top trading partner of the Philippines after Japan.
Our sad experience at the World Trade Organization (WTO) summit meetings should be enough warning to President Arroyo and the members of the country’s negotiating panel to be more circumspect in dealing with the superpowers.
Instead of expecting strong safety nets for our local industries, the Philippine negotiators to the crucial summit of the WTO merely allowed themselves to be lulled into supporting the Anti-Dumping Law, the Countervailing Duties Law and the Safeguard Measures Act (SMA). Of these, only the SMA has been considered “practical enough” by a former counselor of the WTO Appellate Body, Maria Lourdes Sereno. “It’s no wonder that no one availed himself of these two laws,” she said.
There are strong indications, however, that the Philippines will be closer to sealing a free trade deal with the US once a study “assessing the possible impact of such an agreement between the two countries” is completed in September, according to the Department of Trade and Industry (DTI).
Acting Trade Secretary Peter Favila said the DTI commissioned the Philippine Institute of Development Studies last year to do the study in response to a long-standing invitation by the US, under its Enterprise for Association of Southeast Asian Nations Initiative.
Favila said the study covers impact analysis on the general economy, as well as on specific sectors. Another aspect of the study would be the active participation of businessmen in the decision process. “Findings of the study would be validated through regional public consultations to be held in major cities around the country beginning next month.”
In a sense, Favila’s statement means the government, this time, regards the private sector as a key stakeholder in this initiative—crucial to the process of gearing up for possible FTA negotiations.
“More importantly, we will identify the necessary structural adjustments to ensure that our industries remain competitive in an FTA environment,” Favila said.
Recent developments strongly indicate that the US has established several regional and bilateral FTAs globally and in the Asean. It has forged an FTA with Singapore and is currently negotiating with Thailand.
Aside from the increasing oil prices, the weakening of exports is another factor expected to affect the economy’s ability to attain its full-year growth target.
The crucial task now is for both government and business leaders to buckle down to work and assure their countrymen that the Philippines will be fully prepared to deal with the complexities of the FTA on a global scale for the first time in its history despite the political crisis at home.
(September 2, 2005 issue)
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