JAPAN PUSHING JPEPA DUE TO WTO COLLAPSE

JAPAN PUSHING JPEPA DUE TO WTO COLLAPSE The collapse of the World Trade Organization (WTO) talks last week are pushing Japan to become even more aggressive in seeking bilateral and regional trade deals that advance its big corporate interests. More than ever, Japan will try to get through the Japan-Philippines Economic Partnership Agreement (JPEPA) and other such free trade deals what it could not get through the WTO. It is ironic that the Philippines appears poised to ratify JPEPA even as the WTO talks broke down precisely because of questions on the supposed development gains to be achieved from trade and investment liberalization.

The Japanese economy has grappled with stagnant growth and high unemployment for nearly two decades and is aiming to further open up other economies to cope with its internal problems. It is trying to overcome the crisis of its “bubble economy” which has lingered since the early 1990s. While it claimed to be on the way to recovery in 2002 the emerging scenario of a United States (US) economic slowdown, financial disorder, soaring energy and food prices only make its situation more urgent. As it is, Japanese corporations are already testing the political limits of what can be squeezed from its domestic labor force to support their profits. Hence they are now after the greatest possible access to the cheap labor and natural resources of the region with the least intervention and taxes from foreign governments.

The JPEPA’s provisions even go far beyond what was proposed in the failed WTO talks. It includes issues such as investment, government procurement and competition policy which were already rejected at the WTO. The tariff cuts it demands are also far greater than in the WTO.

This is why the Philippines will be on the losing end of the JPEPA which is designed most of all to benefit big Japanese corporations even at the expense of Philippine workers, peasants and economic development. There will only be even more foreign-dominated industrial and service enclaves disconnected from and not benefiting the local economy. Millions of Filipinos already merely struggling to survive will remain impoverished as unequal deals such as JPEPA prevents the economy from developing.

THINK-TANK HITS TRADE SECRETARY FOR CONDITIONING PUBLIC ON JPEPA APPROVAL

Independent think-tank IBON Foundation criticizes Trade Secretary Peter Favila for seemingly conditioning the public that the controversial Japan-Philippines Economic Partnership Agreement (JPEPA) will be approved before the month ends.

JPEPA, a bilateral trade deal that eliminates tariffs on Japanese industrial goods, faces strong opposition for a host of issues including estimated revenue losses for RP of P10.6 billion yearly due to tariff removals under JPEPA, according to IBON research head Sonny Africa.

“The Senate will start deliberating the deal when it resumes its sessions on April 28. Does Secretary Favila believe that the JPEPA is so acceptable to the Senate that it will ratify it in two days?” Africa said, adding that after failing to consult the public, the secretary seems to be trying to influence the Senate through its statements.

He added that government should realize from its recent deals with China that the country is on a losing end with unequal bilateral agreements. JPEPA, for instance, prohibits the government from imposing positive measures like requiring Japanese investors to hire a given level of Filipino nationals, transferring technologies to local companies, or getting a certain level of local content in products it manufactures or subcontracts in the Philippines .

Africa also expressed disappointment that the country’s trade secretary persists in promoting JPEPA amid valid arguments raised against it which the government have failed to credibly address before the Senate committee hearings.

BEST SAFETY NET IS COMPLETE REJECTION OF THE JPEPA

In contrast to their earlier hyperbolic claims, government negotiators are now at least finally acknowledging that the Japan-Philippines Economic Partnership Agreement (JPEPA) will have adverse effects, hence the need for “safety nets”. But no amount of safety nets will be enough precisely because Japan ’s intention is to create conditions for the maximum exploitation of the Philippines ’ natural and human resources through the JPEPA.

The country’s experience with the World Trade Organization (WTO) since 1995 also clearly shows that so-called safety nets are only token mechanisms that have completely failed to stop the disastrous effects of free trade. Anti-JPEPA group No Deal! reiterates that the best safety net against the JPEPA is to reject it completely.

The WTO was questioned before the Supreme Court in 1994. Although the high court eventually found the WTO agreement constitutional, the subsequent trade liberalization has had disastrous effects on the Philippine economy, severely damaging local agriculture and forcing millions of Filipinos to go abroad to seek work. The past decade of poor economic performance actually gives the Supreme Court a reason to revisit its arguments in Tañada, et al. vs. Angara , et al. (G.R. No. 118295) of May 2, 1997 .

That the main beneficiaries of trade liberalization are First World corporations is clearly shown by the fact that foreign firms have taken an increasingly larger share of manufacturing sales. Transnational corporations’ share of total manufacturing sales among the country’s top one thousand firms has grown from 56% in 1999 to 75% in 2004.

The negative effects of WTO-mandated trade liberalization on Third World countries has resulted in a breakdown in further trade talks since 2001 as underdeveloped countries are unable to accept the deeper liberalization being pushed by First World countries through the multilateral trade organization.

Thus, countries such as the US , Japan and the EU nations are seeking further liberalization through bilateral free trade agreements such as the JPEPA. These countries are also using such agreements to force countries to accept issues for liberalization such as investment, government procurement and competition policy, which were already rejected at WTO negotiations.

Government negotiators also appeared to have committed a grave abuse of discretion by entering into JPEPA motivated by a stubborn adherence to free trade dogma unsupported by sound scientific studies and economic reasoning. This is why they are having difficulty defending the JPEPA’s benefits before the Senate committee on foreign relations, forcing senators to continue scheduling hearings in a frantic attempt to find a pretext for sending the agreement before the body for ratification.

Indeed, government representatives have continuously played up the benefits to Japanese investors and domestic big business interests while glossing over the adverse effects on millions of Filipino fisherfolk, workers and farmers. This is a gross betrayal of government’s avowed duty to govern for the benefit of the majority.

The economy has only been weakened by free trade agreements such as under the WTO and like the proposed JPEPA. If the government is prepared to truly develop the domestic economy instead of surrender it to foreign traders and investors, then safety nets would not be needed. If it is not prepared, then no safety net will be good enough.

CONVENORS

Former Vice President Teofisto Guingona Former Senator Wigberto Tañada Anakpawis Representative Crispin Beltran Rafael Mariano, Kilusang Magbubukid ng Pilipinas Nitz Gonzaga, Kilusang Mayo Uno Fernando Hicap, Pamalakaya  Dr. Carol Pagaduan-Araullo, Bagong Alyansang Makabayan Jossel Ebesate, R.N., Alliance of Health Workers Connie Bragas-Regalado, Migrante Clemente Bautista Jr. Kalikasan People’s Network Rechielda Extremadura, Lila Filipina Arman Albarillo, Bayan-Southern Tagalog Roy Velez, Bayan-NCR Ed Cubelo, Toyoto workers union president Sonny Africa, Ibon Foundation Prof. Roland Simbulan, UP Arnold Padilla, spokesperson