MIGRANTS SAY NO TO THE GLOBAL FORUM ON MIGRATION AND DEVELOPMENT (GFMD)

As representatives of states meet on October 29-30 for the Second Global Forum on Migration and Development (GFMD), we call on our fellow migrants, migrant advocates and supporters to join the genuine voice of migrants as we say “No to GFMD!”

The GFMD is a device created by First World countries and international financial institutions (IFIs) like the World Bank to corner the remittances, borne by the blood, sweat and tears of migrants, and use it in funding for the “development” of poor countries. It is being used to sell neoliberal anti-poverty financing strategy that relies on the remittances of migrant workers. 

The false notion of “migration for development” that the GFMD peddles further promotes the systematic exploitation of cheap labor. It is meant to capture the remittances of migrants to ensure super profits of bank monopolies and ensure that debt-ridden economies have enough reserves to pay off debts, especially amid the raging financial crisis. The GFMD thrives on the poverty of Third World countries and forces them to institutionalize migration policies. Clearly, the agenda and framework of the GFMD reveals that what is in store is greater commodification of migrant labor, and greater exploitation and miseries of migrant workers.

The GFMD holds more significance this year because it is being hosted by the Arroyo regime in the Philippines. The Arroyo regime is the nightmare ofoverseas Filipino workers (OFWs). No other regime has bled the OFWs dry with enormous exactions from fees to charges to taxes. It has duped OFWs to part with their earnings in collusion with big business, illegal recruiters, traffickers and racketeers, and in utter disregard of the abuses and violations of migrants’ rights. It is currently riding high on the phenomenal increase in dollar remittances even as OFWs continue to reel from the falling value of their dollars.

It is time to expose that the GFMD is a predatory scheme that does not address the root causes of underdevelopment and the massive migration of poor people, much less consider the harsh conditions and legitimate issues of migrant workers. The GFMD does not promote the development of poor countries but pushes them deeper into the quagmire of poverty. 

The GFMD is a sham assembly that talks about migrants but deliberately excludes the migrants themselves. It talks about the protection of migrants but in reality violates our rights. First World countries, IFIs, banks, businesses, and governments of poor countries– which have profited immensely and unscrupulously from our hard labor– are the same institutions that are behind the GFMD. After years of neglect, abuse and exploitation, it is time that the genuine voice of the migrants be heard: No to GFMD! No to labor export policy! No to forced migration! Create jobs at home! End poverty! Defend and advance our rights!

 

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INCREASED BUDGET FOR THE POOR URGED AMID GLOBAL CRISIS

With the worsening crisis of the US and global economy expected to further aggravate poverty in the country, independent think-tank IBON Foundation today said that it has become more crucial for government to ensure enough resources are spent for the poor.

IBON said that the Arroyo administration must start by increasing the allocation for social services in the 2009 national budget. The group criticized the allocation of 2.5% of the total budget for health; 13% for education; and 0.4% for housing as atrociously low especially in today’s environment of rapidly rising prices and greater economic uncertainty.

IBON said that the perennially low budget allocation for social services will have a deeper repercussion on the poor and vulnerable sectors as the deteriorating global economic crisis destroys more jobs and livelihood and inflates the cost of living.

Experts count slowdown in export demand, tighter flows in foreign investments and increased speculation in food and fuel prices as among the consequences of the US financial crisis and overall slump in the world economy.

With increased poverty, it becomes more urgent for government to provide sufficient social services such as health, education and housing. But the proposed budget levels obviously could not cover the expected increased demand for public schools and hospitals among others.

For the past ten years, government has been spending an amount equivalent to 2.1% of the gross domestic product (GDP) for education, way below the international standards of 5% to 6%. For health, it has been spending only 3.2% of the GDP, lower than the norm set by the World Health Organization (WHO).

IBON said that the government should at least meet these levels to alleviate the present condition in the country seen to worsen with the global crisis. To increase spending for social services, government should put a stop to burdensome payments and cut back on military spending. The proposed budget for 2008 allocates P683 billion for debt principal and interest payment, while it allocates P5 billion for AFP modernization. In contrast, government allots only P30 million for health care asssitance.

The group added the removal of regressive taxes such as the reformed value-added tax (RVAT) on oil is equally urgent to lessen the inflationary impact of the financial crisis.

The Arroyo government should also abandon its proposal for new taxes because these will further burden the Filipinos already suffering from low incomes and spiraling cost of living. IBON also urged the administration not to use the global crisis as an excuse to impose more taxes in its effort to achieve a balanced budget.

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AS SENATE DELIBERATES ON JPEPA: STUDY SHOWS FOREIGN NURSES, CAREGIVERS FACE EXPLOITATIVE WORK CONDITIONS IN JAPAN

While proponents of the Japan-Philippines Economic Partnership Agreement (JPEPA) claim that the pact will create more opportunities for local nurses by allowing them to enter the Japanese market, a study by a Japanese university shows that foreign nurses in Japan face exploitative work conditions and even discrimination. 
  
A study by the University of Kitakyushu in Japan found out that employment programs involving foreign nurses and caregivers have resulted in trainees being forced to work long hours. The Japanese government has also refused to guarantee minimum wage levels, while exorbitant fees of at least 58,000 yen (PhP 23,200) are deducted from the nurses’ salaries every month. 
  
Exploitation of foreign workers on training programs has also been prevalent. Indonesian trainees in Japan , for instance, have reportedly experiencedphysical abuse and been forced to render unpaid overtime, while others have been denied such basic rights as freedom of movement. Meanwhile, non-Japanese in the bigger cities are reportedly subject to racial profiling by being asked to produce their foreign registration cards or passports, which must be carried at all times. 
  
Part of government’s hype is that with the JPEPA, 400 Filipino nurses and 600 caregivers will be allowed to enter Japan for training for over two years. However, the receiving scheme for health workers states that they must work as trainees in designated institutions, undergo six months ofJapanese language training and pass the national certification tests before they can qualify as nurse or caregiver. Although they are already working during this time they will be receiving pay only as a non-licensed worker or trainee or candidate, or as nurse’s aides and caregiver’s assistants. 
  
According to research group IBON, senators debating on the JPEPA should see that the inclusion of nurses in the JPEPA is a deceptive provision that offers uncertain benefits, made only to sweeten the blatantly one-sided, pro-Japan deal. Using Filipino nurses as a justification for approving JPEPA highlights how the Philippine government is willing to sacrifice the welfare of its citizens as well as to cover up for its severe failure in generating jobs and supporting the country’s health system. (end) 
  
The No Deal! Movement for Unequal Economic Agreements in cooperation with the La Sallian Justice and Peace Commission and Benedictines for Peace invite you to the forum ‘JPEPA: Deal or No Deal? The People’s Issues’, 9 am -12 pm, Sept. 12 at the Fajardo Gonzales Auditorium, DLSU Manila. The program includes discussion on the Senate hearings and the presentation of a manifesto on JPEPA.

7 OUT OF 10 FILIPINOS CAN’T BUY ENOUGH FOOD, HAVE TROUBLE PAYING ELECTRICITY BILLS, BASIC COSTS

More Filipinos have trouble buying enough food and paying for basic expenses, according to the latest IBON nationwide survey.

Of the 1,495 respondents, 75.3% said that their family had a problem buying enough food, a substantial increase from 63.2% last January, while 69.7% had trouble paying for electricity and water bills.

The survey also showed that 67.42% of respondents have difficulty paying for transportation costs, compared to 60.6% in January; 73.4% had a problem buying their medicines or paying for their medical treatment; and 68.2% had trouble paying for their children’s tuition.

The April 2008 IBON Survey was conducted from April 7 to 16 across various sectors and regions nationwide with a margin of error of plus or minus three percent (end).

Below is the tabulation of results of respondents’ problems meeting basic expenses.

In the past three (3) months, has your family had a problem meeting the following expenses?

	January 2008		April 2008
	Frequency	Percentage	Frequency	Percentage
Buying enough food	950	63.21	1,126	75.32
Paying for children’s schooling	997	66.33	1,020	68.23
Paying for transportation	911	60.61	1,008	67.42
Paying for water and/or electricity	1,006	66.93	1,042	69.70
Buying medicines/paying for medical treatment	1,024	68.13	1,097	73.38

ACROSS-THE-BOARD WAGE HIKE URGENT, DOABLE –IBON

A legislated across-the-board wage hike, and not regional wage board hikes or non-wage benefits, should be urgently granted to give Filipino workers immediate relief from rising cost of living. And, contrary to claims of employers, such increase is doable.

The increasing labor productivity of local workers, or the ratio of national output to employment, has been steadily increasing over the past decade. IBON research head Sonny Africa pointed out that between 1999 and 2006, labor productivity has increased by 56.3% in nominal terms and 13.1% in real terms (taking inflation into account). This shows that employers could afford to grant the P125 wage hike, which would necessarily trim their profit margin but will certainly not push them to bankruptcy.

He added that such a wage hike is actually not enough to raise minimum wages to the level of decent living, but would at least provide relief for the workers. The current daily minimum wage in Metro Manila is P365, which would become P490 with the proposed wage hike, or only half of the estimated daily living wage as of March 2008 of P858.

Africa said that the wage hike must be legislated and across-the-board since all workers nationwide are affected by the skyrocketing prices of goods and services. He pointed out the regional wage boards have only served to confuse parallel conditions of workers across regions.

Further, a legislated wage hike would have the strength of law behind it and is more enforceable while allowing for fewer exemptions.

JPEPA HIGHLIGHTS GOV’T INSENSITIVITY TO NURSES

Apologists for the Japan-Philippines Economic Partnership Agreement (JPEPA) continue to claim that the treaty’s ratification will mean more employment and foreign remittances for Filipinos. But according to independent research group IBON, JPEPA highlights the Philippine government’s insensitivity to nurses and caregivers.

IBON research head Sonny Africa says that government is trying to portray that the JPEPA is a clear-cut benefit for a few hundred of the country’s health professionals. “In reality government is using them as fodder to cover up for its severe failure in generating jobs for Filipinos,” he said.

The Japanese government is facing the challenge of dealing with its aging population, and it is now state policy to reduce the costs of nursing and caregiving, said Africa . This situation has resulted in low wages and poor working conditions that even Japanese health professionals find intolerable.

The average annual income of nurses in Japan was just US$40,000 in 2004 compared for instance to US$54,000 in the United States . Caregivers’ annual income in Japan is much lower at US$25,200 for females and US$40,000 for males.

In May 2007, a survey conducted by the Health, Labor and Welfare Ministry found that 40% of Japanese nursing care license holders have turned down work in the industry because of low wages and poor working conditions. An earlier survey in 2006 found that 70% of Japanese nurses feel that they could quit their jobs at anytime due to chronic fatigue and professional disappointment.

The JPEPA and other similar deals lets Japan hire nurses and caregivers, for instance, from the Philippines and Indonesia , even more cheaply. After 6 months of language training, applicants can already have on-the-job training for up to 3-4 years while they try to pass the relevant national exams. Although they are already working during this time they will be receiving pay only as non-licensed workers or trainees or candidates– or as nurse’s aides and caregiver’s assistants. This goes far to cheapening the cost of Japan ’s health care, but at the clear expense of Filipino and other trained health professionals, said Africa .

“Using the so-called gains for nurses and caregivers to make acceptable a patently unequal deal like the JPEPA only shows an uncaring government that treats its labor force as mere commodities for export,” he said

EIGHT REASONS TO REJECT THE JPEPA

The JPEPA can be best described in three words: unequal, defeatist and destructive.

Recent government propaganda, however, has been trying to depict the JPEPA as an indispensable agreement– even as the country is currently reeling from a food crisis brought about by the same neoliberal framework that JPEPA was designed from.

With this, IBON is again releasing this summary below, which briefly explains why the country stands to lose from JPEPA and why the Philippine Senate should reject this patently unequal deal.

1. The JPEPA is a grossly unequal deal.

Under the JPEPA, Japan protects numerically more sectors of its economy from investment liberalization than does the Philippines and in addition is also very specific in protecting what it deems as vital sectors.

Advanced Japan lists at least 16 sectors to be so protected, many of which even require a minimum of 66% of full nationality. Japan rightly includes such strategic areas as mining, telecommunications, air and water transport, shipping, and banks and financial institutions for small businesses.

Underdeveloped Philippines , on the other hand, lists just five specific sectors: mining, rice and corn, geothermal energy, atomic energy and shipping. The other items are just formulated generically and are meaningless in terms of explicitly supporting and protecting specific sectors of the economy.

2. The JPEPA gives false or marginal gains for the Philippine economy.

There is much hype that Japan will open its doors to Filipino nurses and caregivers under JPEPA provisions on “movement of natural persons”. The pact allows for the entry and temporary stay of persons who engage in supplying services as nurses or certified caregivers for one to three years (which may be extended). There are, however, strict requirements that must be fulfilled as well as regulations to be followed under Japanese law.

Among the prerequisites are that nurses and caregivers should be proficient in both spoken and written Japanese and be qualified under Japanese law. Although these professional and language requirements are not unreasonable, they are limiting as far as deployment of Filipino health workers to Japan are concerned.

In all likelihood very few nurses and caregivers will be able to surmount the considerable language, technical and cultural barriers. Even assuming Japan lifts its quota limits, only a few thousand health workers may hurdle these barriers.

3. JPEPA lays the basis for increased toxic waste from Japan.

Under JPEPA, the country risks becoming a big dump site for Japanese waste materials, not just the recyclable ones but also toxic materials fit for disposal such as clinical and chemical wastes. Once the pact is ratified and implemented, these wastes can be imported tariff-free, from their original tariffs of 3% to 30% set under the Most Favored Nation treatment of the World Trade Organization.

In the face of widespread protests against JPEPA, the two governments have since come up with a side agreement that supposedly addresses these issues. However, this does not detract from how the Philippine government, under the pretext of developing local waste treatment and disposal capacity, did concede to the entry of these wastes by lowering existing tariffs to zero, notwithstanding the provision on “non-relaxation” of environmental protection.

4. “Free trade” does not result in development for backward countries.

On the contrary, historical and current experience show that: 1) industrialized countries like Japan developed on the basis of protection and discriminatory support; and 2) Third World countries like the Philippines that prematurely liberalized have suffered.

Japan certainly has more to gain from so-called free trade with the Philippines . The Japanese economy’s gross domesti c p roduct (GDP) of US$4.4 trillion in 2006 is 50 times larger than that of the Philippines . Japan is also the biggest foreign investor in the Philippines with a cumulative US$3.9 billion as of 2005, constituting over one-fifth of the country’s foreign investment stock. Japan accounted for 17% of the Philippines ‘ total trade in 2005 and is its second largest trading partner, while the Philippines accounted for just 1.4% of Japan ‘s total trade.

Underlying these figures are economies of vastly different industrial, agricultural and service sector strength. The myth of “comparative advantage” and the so-called “level playing field” between such economies is merely a smokescreen for giving the stronger economy free rein to profit from the other.

5. The JPEPA’s liberalization agenda severely limits the Philippines‘ freedom to set economic policy.

Government controls on how foreign investors operate in the country are necessary to ensure that the Philippines gets concrete and substantial benefits from such investments. This means, among others, ensuring control over investors’ operations through equity and ownership requirements or joint ventures. It also means ensuring benefits to the domestic economy through local content requirements and technology transfers.

These linkages between foreign investors and domestic entrepreneurs will not spontaneously arise and have to be consciously built, yet the JPEPA would disallow policies to build these. Investment provisions on “National Treatment” and “Most Favored Nation Treatment” will prevent the Philippines from favoring Filipino entrepreneurs over Japanese investors. There are also explicit “Performance Requirement Prohibitions” which disallow the Philippine government from requiring Japanese investors to achieve a certain level of domestic content, purchase goods and services in its area of operations, among others.

All these are designed to give Japanese investors greater protections, to ensure that they retain their advantages and to enable them to extract the maximum profit from their operations.

6. The JPEPA will worsen Philippine de-industrialization and cause job losses.

The government claims the local exporters would gain through export growth as tariffs are reduced and removed altogether. But the majority of Philippine exports to Japan are industrial manufactures that are actually subcontracted from Japanese transnational corporations (TNCs) and assembled using imported inputs while taking advantage of cheap Filipino labor.

If anything, the JPEPA actually raises the danger that some electronics and auto parts suppliers based in the country, whether TNCs or any genuinely Filipino enterprises, will be affected. Of course, there is no genuinely Filipino electronics or auto industry to speak of. But there are still such suppliers based in the country that import raw materials or components and assemble them either for re-export or as inputs to other electronics or auto assemblers in the country.

Such firms may have to close down if the removal of tariffs on these items makes them cheaper to import than procure from locally based manufacturers. Local steel makers will also be facing steeper production from Japanese producers. The resulting plant closures and layoffs could well mean some tens of thousands of jobs will be lost.

7. The JPEPA will increase landlessness and undermine agricultural livelihoods.

There is also much hype about supposed export gains from a more open Japanese market for Philippine bananas and pineapples. However, food exports are actually a small and even diminishing share of total Philippine exports to Japan, accounting for only 7.4% of total exports to it from 2001-2006. While food exports potentially have high local linkages to the local economy, grassroots farmers and farm workers are unlikely to benefit from JPEPA.

Agriculture in the Philippines , including that of bananas and pineapples, is in general very backward and underdeveloped because of the lack of true land reform and the absence of government support and extension services. Further, foreign agri-business TNCs, such as Dole and Del Monte and their big domestic corporate growers, account for virtually all banana and pineapple exports from the Philippines.

Local farmers are reduced to entering into oppressive contract growing and farm lease arrangements with these TNCs. These arrangements place all the risk of cultivation onto the farmers and force them to buy overpriced inputs. Such arrangements raise the high possibility that small farmers may lose their lands and become workers for hire or join the exodus to the cities.

8. The JPEPA is not about Philippine development.

The JPEPA’s provisions on trade and investment liberalization are designed to give Japan ‘s corporations the greatest benefit to make huge profits, at the expense of the greatest damage to the Philippine economy.

The pact also contains other measures that complement that central thrust. While packaged as being aimed towards developing domesti c p roductive capacity, their real objective is to make it even easier for Japanese firms to trade and invest in the Philippine on terms that are the most beneficial to them.

These include the supposed cooperation in trade and investment promotion, trade facilitation, technical assistance to meet Japanese requirements and regulations, capacity building in paperless trading, training to facilitate improvements in the competitiveness of workers, human resource development and language proficiency training.

BREAKING MONOPOLIES, REVERSING LIBERALIZATION: A STEP TO END RICE CRISIS

The presence of a rice cartel is only part of the monopoly control of land and capital in Philippine rice production, trade, and marketing and aggravated by neoliberal policies adhered to by the Philippine government

By Jennifer H. Guste

IBON Features– As the government insists there is enough rice available for everyone, it is now looking at rationing rice to three kilos per family, and has secured the importation of around 2.2 million metric tons (MT) of rice from Vietnam, Thailand and the United States. This is the country’s biggest volume of importation since 1998.

From being a self-sufficient and rice exporting country in the 1980s, the country has become a net importer of rice since 1993. It is now the world’s top importer of rice, the country’s staple food crop.

Why this has become so can be traced to the backwardness of Philippine agricultural production and the exploitative relations of production, which are both exacerbated by globalization. Production tools are outdated, almost all farms are not mechanized, more than half are not yet irrigated, and most of all, seven out of 10 peasants are still landless. Despite three agrarian reform programs, land is still in the hands of few families who control not only land but also trade and marketing. Aggravating the condition are the globalization policies of trade liberalization, privatization and deregulation adopted by the government since the late 1980s.

Rice Production in Chronic Crisis

Philippine average rice yield per hectare is stagnant. Since the 1990s, the country’s rice yield has averaged at 3 metric tons per hectare even as it records yearly increases in production. According to the International Rice Research Institute (IRRI), the required yield for the Philippines to sustain food security is 5.4 metric tons per hectare.

Philippine rice lands is only four million hectares compared to its counterparts in Asia. For instance, Thailand devotes more than 10 million hectares for its rice production; Vietnam has more than seven million hectares planted to rice.

Rice production remains small-scale and productivity is low. This situation is even worsened by the increasing instances of conversion of rice farms to commercial uses and conversion of crops from rice to export winners, which has put the country in constant state of crisis in its rice supply.
Meanwhile, landlessness and the absence of government support through production and price subsidies leave millions of Filipino rice farmers at the mercy of big land owners and traders.

Even with the use of hybrid rice that promises a boost in rice production with minimal lands devoted to rice farming, rice supply in the country is still under threat of shortage and government will always find reason to resort to rice importation to fill in its buffer stocks. According to the National Food Authority (NFA), the country can only supply approximately 90% of its total rice consumption; the rest, according to the NFA, would have to be imported.

In reality, government has practically stopped subsidizing local agriculture for decades, and can be seen from the meager budget allocations received by the agricultural and fisheries sector. Worse, the funds intended for the sector are even reportedly siphoned off to corruption.

Even its much-hyped Agriculture and Fisheries Modernization Act (AFMA) did little in improving post-harvest facilities or even significantly increasing irrigated rice farms.

Reinforcing backwardness

Policies of globalization on rice, i.e. trade liberalization (allowing rice imports), privatization (clipping NFA powers), and deregulation (lifting of government production and price support), which the government started to implement in the 1980s, has reinforced the rice crisis.

The privatization of the NFA, for one, has been one of the conditions for the Philippine government to avail of loans from the World Bank and the Asian Development Bank (ADB). The NFA was once allowed to engage in grains procurement and distribution using government buffer stock and subsidized pricing system as main intervention instruments. But since the 1980s as a result of reforms adopted by the Philippine government to comply with the World Bank and ADB prescriptions, the role of the NFA in ensuring the country’s food security and price stabilization has been reduced to being a “facilitator” of the market forces– the big rice traders and retailers.

The NFA has increasingly relied on rice imports for local distribution. On the other hand, from an average of 7.95% of total palay production in 1977-1983, and 3.63% from 1984 to 2000, NFA rice procurement from 2001 to 2006 was barely 0.05% of total palay production. The NFA is originally mandated to procure at least 12% of total palay production.

Other than the World Bank and ADB conditionalities for minimized NFA intervention in grains procurement and trading, under the Agreement on Agriculture (AoA) of the World Trade Organization, the country has been compelled to import a minimum volume of rice from other countries whether or not it produces rice sufficiently. Rice importation has increased as a consequence, from 0 in 1994 to 257,260 MT in 1995 and consistently increasing to 1.7 million MT by 2006.

Yet, with the current rice crisis, private traders have still renewed calls for the full privatization of the NFA. Secretary Arthur Yap of the Department of Agriculture is even entertaining options to lower tariffs on rice importation to encourage greater private sector participation in rice importation and trade. Presently, licensed private traders are allowed to import a minimum of 300,000 MT of rice but this according to the NFA has been hardly utilized by the private traders due to the 50% tariff on rice.

Ironically, instead of re-considering government subsidy to farmers’ production, an increase in the subsidy given to the NFA is even being considered to allow the state agency to shoulder some of the import costs of private importers!

Yap said the scheme would call for the NFA to import rice “through a tax-expenditure-subsidy scheme and the volume that NFA brings can be sold to the private sector for it to distribute on the basis of an equalization fee that they will bid for.” Under this plan, the private sector will be allowed initially to bring in 163,000 tons of rice this year, with each importer given a maximum volume of 2,500 tons.

Rice Price Speculation

Peasant organization Kilusang Magbubukid ng Pilipinas (KMP), on the other hand, maintains that there is no need to import rice. According to the group, if the projected 7.2 million MT palay output for this season is met, combined with the total rice inventory as of March 25, then there should be enough rice available for every Filipino table until the first week of October, even without importation.

In an interview with IBON Features, KMP chairperson Rafael Mariano said that the government is importing rice because it has already committed rice importations earlier from Vietnam and the US.
He said the NFA is importing rice because it has persistently failed to perform even its minimal procurement of 12% of the total palay production. Mariano added NFA has only procured only about 1% of palay production in the last cropping season, leaving most of the tradeable rice into the hands of big rice traders, particularly the so-called Big Seven cartel who now dictates the price of rice in the market.

In fact, a few days after the DA wrote a memorandum to the office of the President warning of the threat of a tightening global rice supply and thus the need to secure rice imports, news of a rice shortage in major markets in the NCR and in the provinces broke out. Subsequently, rice prices skyrocketed and created panic among rice retailers and consumers nationwide.

The same thing happened during the rice crisis in 1994-1995, largely a result of the semi-privatization of NFA which then procured only 0.5% of total palay production. Private traders seized the opportunity to create an artificial rice shortage and jacked up prices by as much as 90% to 100 percent.

The monopoly control in the trade and marketing of rice through the so-called Big Seven manipulates rice price increases especially during rice crises. The reduced role and intervention of the NFA in the rice market allows private traders to control both the trade in inputs and produce, thus influencing the movement of prices in the trade and marketing of rice.

Despite its import injections, the NFA’s limited distribution because of its minimal palay procurement also prevents the NFA from influencing retail rice prices. In fact, the NFA has distributed an annual average of only 6% of the nation’s rice requirements, and much of the rice distributed is even imported.

Ending Monopolies

The presence of a rice cartel is only part of the monopoly control of land and capital in Philippine rice production, trade, and marketing. It is a manifestation of the chronic rice crisis in the Philippines, which is aggravated and reinforced by neoliberal policies adhered to by the Philippine government.

There are doable measures to solve the chronic rice crisis the country. One step that government should do is to regain control of the trade and marketing of palay and rice to break the monopoly control of cartels. The country should also break away from binding agreements that government made to the GATT-WTO and reinstate agricultural tariffs while increasing support to Filipino farmers. Ultimately the crisis could be resolved by implementing a genuine agrarian reform program that do not only provide free distribution of land to farmers, but also provides input and capital subsidies, and investments in post-harvest facilities that will help end land monopoly.

AMID BARRAGE OF HYPE, REALITY OF WEAK ECONOMY PERSISTS

The clearest signs of economic failure under the Arroyo administration are in the poor conditions of millions of Filipinos.

By Sonny Africa
IBON research head

IBON Features– The administration has made much noise of its economic performance in 2007. Most of all it crows about rapid growth in gross domestic product (GDP), the peso’s appreciation against the dollar, and reining in the national government deficit. Unfortunately these are not the whole story. There is a barrage of hype but the reality is of a weak economy and, absent fundamental economic reforms, millions of Filipinos consigned to joblessness and poverty.

A more complete descent into economic turmoil was averted last year by record overseas remittances, debt-driven spending, an upsurge in “hot money”, the fortuitous weakening of the United States (US) dollar, and a US economy that had yet to fall into recession. There was also an unmatched privatization spree with the P91 billion worth of public assets sold equivalent to nearly as much as had been sold in the previous 15 years spanning three administrations. These conditions are unlikely to recur in 2008– and the downward pull of accumulated economic problems is unavoidable.

Crisis times

The clearest signs of economic failure are in the poor conditions of millions of Filipinos. The 11.3 percent average annual unemployment rate over the period 2001-2007 is the worst 7-year period recorded in the country’s history. There were 4.1 million jobless Filipinos and 6.8 million underemployed last year, or almost 11 million Filipinos looking for work.

The government uses statistical sleight of hand to give the illusion of an improved jobs situation. Its definition of unemployment since April 2005 cuts the number of jobless not by giving them jobs but by classifying long-discouraged jobseekers and those not available/willing to immediately take up work as “not in the labor force”. This had the effect of reducing the “official” unemployment by around 3.5% and the number of jobless by 1.4 million in 2007.

Yet job creation is far short of the targeted million jobs a year and also of poor quality. Despite supposedly record growth the 861,000 net additional jobs created in 2007 is only a 2.6% increase in employment from the year before and is the fourth slowest rate of job creation in the last seven years.

The sources of jobs also betray economic backwardness. The leading sector in job creation is domestic household help with an additional 142, 000 jobs, followed by 116,000 jobs in transport, storage and communication, and 111,000 jobs in wholesale and retail trade. These are among the lowest-paying, most temporary and insecure jobs in the country. In stark contrast only 72,000 agriculture jobs and 4,000 manufacturing jobs were added yet these sectors constitute the internal productive base of the national economy.

The latest Family Income and Expenditure Survey (FIES) noted average family income dropping between 2000 and 2006 with nominal incomes not keeping up with inflation. The incomes of the poorest four-fifths of Filipino families – or some 13.9 million families – fell between five and almost 13 percent. These 70 million or so Filipinos each struggle to survive on P110 or even much less a day.

Critical times

Things can only get worse in 2008 with the US recession and a generalized slowdown in the world economy. The domestic situation is made worse than it should be by internal weaknesses resulting from “globalization”, the erosion of domestic productive sectors and over-dependence on trade, foreign loans and capital.

As it is, manufacturing sector growth slowed to 3.3% in 2006 and its 23.1 percent share in GDP is as low as in the late 1950s. Agriculture grew at a faster 5.1% clip but then wide year-to-year variances are the norm for the sector and the its 18.4% share in GDP is the smallest in the country’s history. This internal domestic weakness makes the country unduly vulnerable.

The country has significant links to the US economy which remains our top investment and exports partner (accounting for 20 percent of the country’s respective totals). Drops in US consumption and investments will be deeply felt. This effect is magnified by “globalization” where much of Philippine exports to East Asian countries like China, South Korea, Taiwan and Malaysia are actually intra-firm trade with the US still the ultimate destination. Slower growth in third party countries that depend on US and which Philippines deals with will also cause problems.

Even the vaunted local information technology (IT)-enabled industry will likely be hit hard because of its considerable dependence on the US market, further aggravated by the continued peso appreciation. The US is an overwhelming presence in the business process outsourcing (BPO) sector and accounted for nearly nine-tenths of total BPO exports revenue and over two-thirds of foreign equity in 2005. Nearly nine-tenths of BPO service exports were to the US market. The impact will be most felt in the National Capital Region (NCR) where an estimated 80% of BPO employees are located.

There are also other sources of problems. Slow global growth could restrain OFW deployments and slow down remittances which will reduce domestic consumption. The administration’s inability to even let revenues keep up with nominal GDP growth, compounded by the dearth of remaining assets to sell, could lead to an uncontrolled intensification of its fiscal crisis in 2008.

The rumbling political instability stemming from unresolved issues of legitimacy, graft, corruption and political violence are also taking their toll. If these are amplified by a drop in local business sentiment then this year or the next might even see the beginning of a steep downward economic spiral.

All this highlights the folly of government economic strategies which unduly rely on external factors instead of creating jobs and producing goods by building domestic agriculture and industry. The country’s economic prospects are unfortunately made even worse by the crying need for credible leadership underpinned by a broad-based democracy.

JPEPA Economic Invasion:Who Among The Senators Will Be The Collaborators And Patriots?

No Deal!, a coalition of organizations and individuals opposing the Japan-Philippines Economic Partnership Agreement (JPEPA), said that the treaty symbolizes the “second invasion” of the country by Japan, and that senators may choose to be patriots or collaborators in this invasion when they vote on the controversial agreement.

“This invasion could prove to be even more destructive on the economy and people’s livelihood than the Japanese assault during World War II,” No Deal! spokesperson Arnold Padilla said. “So we ask our senators, will they collaborate with the aggressors and participate in the rape of our economic sovereignty and patrimony? Or will they choose to be patriots and fight till the end to defend the national interest?”

The anti-JPEPA coalition noted that the treaty is part of Japan’s grand design to establish a Comprehensive Economic Partnership Agreement in East Asia (CEPEA). Japan’s motives in the JPEPA are still essentially the same with its agenda when it invaded countries, including the Philippines, more than six decades ago. Before, they wanted to set up the Greater East Asian Co-Prosperity Sphere, said the group.

No Deal! warned senators that history has not been kind to traitors and collaborators. It cited Jose P. Laurel, who chose to collaborate with the Japanese during World War II, and is known in history as the puppet president of Japan. On the other hand, Jose Abad Santos is regarded in history as a true patriot for choosing to be executed by the Japanese imperial army instead of pledging allegiance to the invaders. “We celebrate and build monuments for our heroes and only have scorn for traitors,” Padilla said.

Senate insiders told No Deal! that the committee report on the JPEPA, prepared by the committees on foreign relations and the trade and commerce, is “almost done” and might be circulated next week. Senator Miriam Santiago, chair of the foreign relations committee, is expected to endorse the report and call for the ratification of the treaty.

“We have been holding bilateral talks with senators through various channels to convince them to say ‘no deal’ to the JPEPA. Our latest count is that five to six senators will likely vote against the treaty,” said Padilla. They include Senators Jamby Madrigal, Nene Pimentel, Manny Villar, Pia Cayetano, Noynoy Aquino, and Chiz Escudero. “We will closely monitor the senators’ position and public statements regarding the deal, as well as report the results of our dialogue with them to the public so that the people will know who will betray the country and who will defend it,” he added.