Wednesday, March 14, 2007 RP not yet benefiting from trade deal with Korea
THE Philippines has missed out on benefits it should have enjoyed out of an economic cooperation agreement between South Korea and the Association of Southeast Asian Nations (Asean) trade block signed in the middle of last year yet.
Researchers of the Philippine Exporters Confederation Inc. (Philexport) have found out that the Asean block, including the Philippines, had signed way back on Dec. 13, 2005 a comprehensive economic agreement with the Republic of Korea.
That agreement was supposed to have taken full force July of last year, opening up the South Korean market to a wide range of Philippine goods. It was forged way before the Philippines entered into a Japan-Philippines Economic Partnership Agreement (Jpepa).
The hitch was thay the Philippine government had not signed an instrument of ratification to the agreement and an executive order amending the tariff rates in the Philippines to align them to the tariff rates mandated by the agreement.
Learning of an existing economic agreement that has not been in force here, Philexport president Sergio R. Ortiz-Luis called on President Gloria Macapagal-Arroyo to act on it.
He said the oversight has prevented Philippine exporters into cracking at the Korean market, which has been seen by them as largely closed. It was more of lost opportunity due to default, he added.
Unlike the Jpepa which requires ratification by the Philippine Senate, the Korean trade deal only needed presidential fiat. This however was apparently overlooked by government officials involved in the negotiations.
Although the agreement was comprehensive in that it included general provisions on liberalizing trade in goods, and services and the free flow of investments between Asean nations and Korea, specific agreements only covered trade of goods.
In the case of the Philippines, tariff on goods traded with Korea under the treaty would be drastically reduced to almost zero by 2008 and zero the following year.
Products that are considered in the sensitive list were grouped in five. The first group would be subjected to tariff ceilings of not more than 50 percent by 2016. Petrochemical products from Korea are covered in this part of the agreement while salted shrimps, prawns, fresh cheese, oranges, apples and pears are considered sensitive in Korea.
Covered by tariff rate quotas with certain volumes subjected to minimal import duties while the excess will be charged higher in Korea are live, fresh, chilled or frozen shrimps, prawns and cassava, while the Philippines did not list any product subjected to tariff rate quotas.
The Philippines listed rice, cane sugar, beet sugar, carpets and automotive products among the goods exempted from tariff concessions when brought from Korea to the Philippines.
Korea, on the other hand, listed as protected its fish, onions, garlic, fresh and dried bananas, pineapple and rice products. ( Philexport News and Features/Sunnex)
