Philippines, EU begin free-trade talks
The Manila Times | 11 March 2010
Philippines, EU begin free-trade talks
Ben Arnold O. De Vera and AFP
The Philippines has begun talks with the European Union (EU) for a bilateral trade agreement, according to the Department of Trade and Industry.
Outgoing Trade Secretary Peter Favila told reporters on Tuesday night that a Philippine trade delegation headed by Trade Assistant Secretary Jose Antonio Buencamino would meet up this month with counterparts in Brussels, Belgium—the seat of the EU.
Favila said the meeting would lay the ground for a bilateral trade pact, adding that consultations would encompass the process, coverage and terms of reference.
The Trade secretary said the agreement with EU might also come in the form of an economic partnership agreement, similar to the Japan-Philippines Economic Partnership Agreement.
The EU is keen about pursuing bilateral trade agreements with individual-members of the Association of Southeast Asian Nations (Asean) rather than a free trade agreement with the entire bloc given issues with Myanmar’s human rights record. Negotiations for an Asean-EU trade accord stalled last year.
Indonesia had signed a partnership and cooperation agreement with the EU last year, while Singapore, Thailand and Vietnam are on advanced stages of negotiations. Brunei and Malaysia are set to commence talks with the EU.
Europe accounts for about 17 percent of global trade in goods, about 25 percent of services, and is the source of about half of global foreign direct investment in recent years.
The resumption of Philippine-EU free trade comes as the European bloc and the United States are poised to shore up their Pacific influences, fearful of being sidelined as China and other fast-growing Asian economies speed up their integration.
Talks opening Monday in Melbourne will focus on a proposed Trans-Pacific Partnership (TPP) agreement linking the US market with Australia, Brunei, Chile, New Zealand, Peru, Singapore and Vietnam.
Officials hope the TPP will form the nucleus of a wider Asia-Pacific trade zone that would eventually rope in China, Japan and South Korea as well as key Southeast Asian nations.
The talks will follow the launch of negotiations on a free-trade agreement between Singapore and the EU, which is also keen on expanding trade ties with Southeast Asia.
The US and Europe have been shut out of a growing web of Asia-centric trade pacts spurred by the region’s 1997 financial crisis and by a lack of progress in the Doha round of global trade talks, analysts said.
While the United States is “unquestionably” a Pacific power, it “lacks a comprehensive Asia strategy”, said Ernest Bower, a Southeast Asia expert at the Center for Strategic and International Studies in Washington.
“The lack of consistent US focus in the region has enabled the ascendance of Chinese power,” Bower said, adding that it could slowly undermine US business interests and eventually degrade US security capabilities.
The new trade attention from the West comes as Asian countries lead the rest of the world in recovering from the global economic downturn.
“That the US and the EU are knocking on Asia’s doors is a recognition that the centre of economic power is shifting, or has shifted, to our region,” an Asian diplomat closely involved in trade issues told Agence France-Presse.
“They know very well that ignoring Asia will be at their own peril. China is already a major trade partner for many Asian countries and is leading efforts toward regional economic integration,” he said on condition of anonymity.
Deputy US Trade Representative Demetrios Marantis warned that Washington “faces the daunting prospect of getting locked out” by Asia-specific trade pacts.
The US has free-trade accords with Australia and Singapore and has also negotiated a trade pact with South Korea, but this has yet to be implemented because of fierce disputes over cars and beef.
China has been more aggressive in wooing regional partners.
An agreement between China and the Asean covering nearly two billion consumers went into effect this year, creating the world’s biggest free-trade area in terms of population.
There are also efforts to form a larger, all-Asian free-trade zone spanning China, Japan, South Korea and the 10 Asean states.
