Independent research group IBON cautions the Aquino government in committing to a free trade agreement with the US, as a US trade official arrives in the country to secure new trade and investment areas, as well as the possibility for a new trade pact.
Assistant Trade Representative Demetrios Marantis is in the Philippines to continue discussions on the country’s access to the Trans-Pacific Partnership (TPP), which the US is pushing among Asia-Pacific Economic Cooperation (APEC) members. Like previous US-led trade agreements, the TPP seeks to eliminate tariffs among countries in the region to ensure the free flow of US goods, services and capital in Asia Pacific. Access to the TPP is by invitation, and the Philippine government has reportedly expressed its intention to the US that it wants to join the regional pact.
The Department of Trade and Industry (DTI) has earlier announced that the country’s accession to the TPP would pave the way for around billions of dollars worth of exports for the Philippines. However, the research group said that while the agreement may result in increased economic activity, the benefits would be largely limited to US-based industrial, agribusiness and service corporations.
Unlike Philippine sectors, the US economy remains increasingly protectionist—for instance its agriculture sector, including rice and corn, is still heavily subsidized despite its membership to free trade agreements like the World Trade Organization. This has overwhelmed Philippine agriculture, which is already suffering from decades of liberalization, lack of state support, etc. It will also impede efforts toward strengthening Filipino industry, as the US moves to secure much of the local market.
The research group added that as the US faces worsening economic crisis, the need to expand US economic influence in the region becomes more urgent for its economic recovery. Forging agreements like the TPP aims to further hasten and expand economic liberalization in the region while moderating Japan and restraining emerging economic giant China.
The Philippines, as well as other developing countries in the region have seen their livelihood deteriorate after decades of free trade and liberalization. Instead of free trade agreements, the country needs trade protection against massive imports to protect and build the domestic economy, the group said. (end)