Gov’t eyes April okay for JPEPA
GMA News | 03/30/2008
BusinessWorld: Gov’t eyes April okay for JPEPA
A deal promising freer flow of trade between the Philippines and Japan could finally be realized next month, some two years after it was originally signed and subsequently subjected to intense, and at times, heated, scrutiny.
Trade Secretary Peter B. Favila said the Philippines could start reaping the benefits of the Japan-Philippines Economic Partnership Agreement (JPEPA) and compete head-on with Southeast Asian countries with similar free trade pacts.
"I want to get it ratified before the end of April ... I want to have it done as soon as possible. We’re just waiting for Senator Miriam Defensor-Santiago to come home," he said in an interview.
Ms. Santiago, chairman of the Senate foreign relations committee and viewed as an administration ally, has raised concerns over the JPEPA given claims that it violates the Constitution.
The senator, who is currently out of the country, was not available for comment.
Earlier this month, she indicated that her committee, which has wrapped up its JPEPA hearings, would call for "conditional concurrence" with the country’s charter before the Senate gives its approval.
The matter is expected to be taken up taken up on April 28 after Congress resumes session following a month-long break.
"The constitutional issues are paramount," she said early in March.
"Hence, the Senate should ensure that the Supreme Court will not declare JPEPA unconstitutional. If we do not take scrupulous care in the Senate and the court declares it unconstitutional, such declaration of unconstitutionality will not be a valid defense if Japan later sues the Philippines for nonperformance of contract obligation...," Ms. Santiago said.
The agreement, signed by President Gloria Macapagal-Arroyo and then Japanese Prime Minister Junichiro Koizumi on September 9, 2006 in Finland, calls for zero tariffs on almost 95% of Philippine exports to Japan.
At the same time, it requires both countries to eliminate tariffs on almost all industrial goods within 10 years after the deal takes effect. Other provisions allow for the entry of more Filipino workers to Japan.
The proposed trade deal has generated heated debate, which was not helped by the government’s early insistence that its details be kept under wraps. An early charge was that it would allow Japan to export medical waste to the Philippines, which officials denied.
A key issue for Ms. Santiago is a "national treatment" provision, which allegedly gives Japanese nationals get the same rights as Filipinos and as such violates constitutional curbs on foreign ownership.
Treaties and trade deals have to be approved by the Senate, which is currently dominated by opponents of President Gloria Macapagal Arroyo.
The chamber staged several hearings regarding the JPEPA last year, where legislators scored the government for failing to explain the deal substantively. Senators have said they could return it with the recommendation that controversial provisions be renegotiated, or ask the government to conclude a side agreement.
The government had originally wanted the JPEPA, which was approved in December 2006 by the Japanese Diet, to pass Senate scrutiny last year.
Filipino businessmen, for their part, expect the Senate to ratify the deal, said Philippine Chamber of Commerce and Industry (PCCI) chairman and special trade envoy Donald G. Dee.
"Senators already said they will ratify it. We can expect that to happen," he said in a separate interview.
"Japan knows that our ratification is forthcoming. I don’t think there were foregone advantages for the Philippines. With the ratification, we can expect more robust trading with Japan.
"We expect to get a substantial market share for our various products such as pineapple and mango ... even for our light industries such as furniture and garments."
The Trade department has said the country could lose about P222 billion in expected investments from Japan over the next four years if the JPEPA is not ratified, citing similar trade deals inked by Japan with the Philippines’ neighbors.
The PCCI, seeking to drum up support for the deal, last year released a study by its non-profit think tank, the Universal Access to Competitiveness and Trade, claiming benefits of nearly $1.5 billion in additional exports and up to 150,000 new jobs.
The study focused on benefits to four industries - electronics, automotive, garments, and furniture - and said investments could also increase by nearly $300-445 million.
Upstream industries could also benefit to the tune of $500-751 million when exporters purchase more inputs or raw materials. The think tank claimed that exports of the four "vital" Philippine industries would go up by 20-30% with easier market access to Japan.
Mr. Favila, meanwhile, said the Trade department was proposing that the trade committees of both the Senate and the House of Representatives be included in the government’s trade negotiating team.
This would "help to expedite ratification of future free trade deals" and has received "positive feedback" from senators, Mr. Favila claimed.
"But that would entail a lot of work, so much time would be drawn from them. We’re still looking at it."
— from a report by B. S. Sto. Domingo, BusinessWorld
