The Philippines’s Global Trade Negotiations Agenda: Review and Update of RP’s Trade Negotiations Strategy By Secretary Peter B. Favila

The Philippines’s Global Trade Negotiations Agenda: Review and Update of RP’s Trade Negotiations Strategy

By Secretary

Peter B. Favila

Consultation and Information Dissemination on Regional Trade Agreements and Free Trade Agreement 16 April 2008, 9:30 am Bayview Hotel, Manila


Good morning.

I am honored that you have asked to speak on the trade negotiations agenda of the Philippines. It is heartening to see business and academic leaders coming together for this initiative to bring various stakeholders up to speed on the different trade agreements which the Philippines is currently negotiating. It is precisely this readiness to transcend barriers and go in partnership with one another that enables us to achieve out goals, much more than if we work in isolation, or worse, work to put down other people.


Forging agreements with other countries, seeking and maintaining alliances across a whole range of issues, also entails transcending barriers, looking past our differences and addressing the issues affecting us all.


The trade negotiations agenda is driven by the never ending quest for greater market access for Philippine exports, followed by investment – especially foreign investment- and a deepening of productive capacity, industrial linkages, and competitiveness, especially in small and medium enterprises. This is the virtuous cycle of the Philippine trade negotiations that we seek. There are basically two fronts where we apply the trade negotiations agenda – the multilateral front, which is the World Trade Organization and the ongoing Doha Round of trade negotiations; and the regional engagements we have pursued in the last 16 years. And to make matters simple for you, if greater market access eludes us in the Doha Round, we will pursue it in the regional (and bilateral) engagements; and vice versa.




What We Seek


As I have said, our agenda is focused on market access. Our engagement in all fore must result in a net expansion in the access for Philippine products abroad.


This is the essence of engagement in the AFTA-CEPT, in the NAMA (non-agricultural market access) negotiations in the Doha Round, in the JPEPA, and in the various ASEAN-plus FTA negotiations. And should the ASEAN-EU and ASEAN-US FTA negotiations get on moving, we will have covered the entirety of Philippine trade interests.


Of course, the market access benefits from FTA s are much deeper than in the Doha Round, where free trade is not the mandate. But multilateral engagements allow us to tap into the markets of other emerging markets (e.g. Brazil, South Africa) with whom we have no intention, for now, to negotiate FTAs.


Moreover, the WTO is the stalwart of stable and predictable trade rules. The best example here is the Agriculture negotiations in the Doha Round, where we aim to forge permanent rules that would limit, even eliminate, farm subsidies in the developed world. What could be fairer and more desirable than a result such as that!


Another example is the Doha Round negotiations on anti-dumping practices, where it will be to our benefit if certain rules are clarified and will allow peace of mind, so to speak, whenever we use trade remedies


Just to highlight one important difference between the multilateral and regional negotiations, one will not expect subsidy and anti-dumping disciplines to be agreed in FTAs, but such disciplines will necessarily form an integral part of multilateral trade negotiations like the Doha Round.


We have also sought to lock in enhanced competitiveness through the trade negotiations agenda. This principle simply dictated that we need to engage in trade negotiations because in doing so, domestic competitiveness is harnessed. This is best illustrated in the Services negotiations of the Doha Round where the request-and-offer process has revealed rigidity in present laws; for example, with respect to allowing foreign professionals to operate in the Philippines. I am not saying that we will allow foreign doctors, lawyers, accountants, and architects to practice in the Philippines. That’s up to the lawmakers. What I am saying, however, is a number of services sectors currently reserved exclusively or predominantly for locals will inevitably need to face the challenge of competition from foreigners.


At the same time, the sensitivities in particular sectors are very much top of mind. This is why the Philippines has been rather vigorous in the negotiations on Special Products and the Special Safeguard Mechanism in the Agriculture negotiations of the Doha Round. This is why the Philippines has been a front liner in negotiating higher flexibilities in the NAMA negotiations, especially in cases like ours where autonomous liberalization has taken place over the last 15 years.




Multilateral Approach


The Doha Development Agenda (DDA) will remain as a top priority of the Philippines. With over 151 members, the ongoing WTO multilateral trade negotiations is the most sensible approach towards the development and implementation of a common set of trade rules to be applied to everyone.

The Philippines will continue to adopt a dynamic yet practical approach to international trade negotiations and will fight strongly for its economic interests (i.e. market access for its exports). At the same time we will strive to maintain adequate internal policy options to assist domestic industries in adjusting to freer global competition.

Given our limited manpower and other resources, and depending on the nature of the issues, the country will either pursue particular issues on its own (e.g., dispute settlement cases), align with other WTO Members and various groups in the WTO (e.g., G20 and G33 in Agriculture and NAMA 11 in industrial tariffs), or allow issues to be resolved by the major players. This last option is most appropriate if interests in an issue converge with the interests of a major player (e.g., in anti-dumping issues where the country shares a lot of positions advocated by the United States).




Bilateral and Regional Approaches


Let us now move on to the bilateral and regional agreements.


JPEPA is the only bilateral EPA to which the Philippines has signed on and Senate concurrence is currently being awaited. The Philippines looks forward to negotiating other bilateral EPAs with other trading partners at the opportune time.


Meanwhile, the country will continue to entertain regional efforts towards economic integration under the ASEAN dialogue partners’ context. The Free trade agreements (FTAs) negotiated will be designed to complement, be of high quality, and consistent with the allowable rules under the multilateral trading system or the WTO.


The Philippines will support ASEAN high-level officials in pushing for the conclusion of ongoing negotiations before undertaking any new FTA negotiations.




Internal Strategies


At the home front, the DTI supports the strengthening of its international trade policy and negotiations arm in the Bureau of International Trade Relations (BITR). The Bureau will be expanded under the DTI’s rationalization plan to enable effective undertaking of the country’s international trade policy and negotiations agenda.

Let me conclude by assuring you that the DTI supports calls for greater transparency in trade policy formulation and in the conduct of international trade negotiations. We will cooperate with all stakeholders in pursuing the country’s trade policy and negotiations agenda consistent with the country’s national interest.


I am sure you will hear many, perhaps even opposing, points of view in the course of this consultation, and that’s absolutely fine. Diversity of points of view is the essence of democracy, just as openness to this diversity is the key to a fair and even-handed agreement.

Beneath this multiplicity of viewpoints are commonalities that bind us. All of us here are united by a single purpose: to build a proud Republic that is inclusive, progressive, globally competitive and highly esteemed by other nations of the world.


If we always keep that in mind, the range of viewpoints and array of perspectives we shall hear from one another will not divide us, but rather enrich our possibilities.

I wish all of us a productive and meaningful consultation. Thank you.




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