By Victoria “NIKE” De Dios

With the RCEP set for ratification in the Senate, many business groups and even foreign chambers are supporting the Philippines’ membership in the world’s largest free trade agreement called Regional Comprehensive Economic Partnership (RCEP) Agreement, some farmers expressed their opposition to this thinking that this is disadvantageous to them.

Speaking to THEPHILBIZNEWS, no less than DTI Secretary Ramon Lopez pointed out the Filipino farmers and other farmers in the country will certainly benefit from the RCEP contrary to what others thought.

“They need to understand that the farmers and entire agricultural sector will benefit from the RCEP agreement. Theis covers enhanced market access in the RCEP region, cheaper access to raw materials, trade facilitative measures, and even investments in smart agriculture and research and development”, the Trade Chief said. 

Lopez reiterated that the RCEP Agreement did not only exclude highly sensitive agricultural products from tariff liberalization. Perforce, RCEP even provides enough safety nets and flexibilities to address any threats to industries that may arise as a result of the implementation of the agreement. 

“Under RCEP, tariff protection remains for these highly sensitive products, including swine meat, poultry meat, potatoes, onions, garlic, cabbages, sugar, carrots, rice, cement, and flat-rolled products of iron or non-alloy steel, among others”, Lopez clarified.  

He further stressed that nevertheless, these products while excluded from RCEP would still enjoy the other benefits that the agreement offers. In addition, appropriate trade remedies remain in place including WTO global safeguards and an RCEP Transitional Safeguard.  

Should there be increased imports that threaten the local industry, the agreement provides that WTO safeguards can still be availed of. The agreement also provides a transitional safeguard to address the said scenario by allowing Parties to suspend further reduction of customs duties or increase customs duties following a surge in imports caused by a Party’s commitments under RCEP. Anti-Dumping and Countervailing Measures are also available which reaffirm Parties’ rights and obligations under relevant WTO agreements.  

“In other words, issues and concerns of some group of farmers are fully addressed”, Lopez added. 

Addressing fears of foreign competition, Trade Assistant Secretary Allan B. Gepty explained that said competition is already present since the Philippines is a member of the WTO and other free trade agreements. Several of these free trade agreements include ASEAN Member States and other countries participating in RCEP. “In other words, in terms of competition the same is not totally new. If there is something new in RCEP it is more of coverage of the free trade area and the rules and disciplines”, Gepty added.

Asec. Gepty stressed that the RCEP Agreement has mechanisms providing for adjustments to commitments within the agreement, noting that the agreement tries to accommodate the circumstances of RCEP parties, which are at differing levels of development.  

“There may be cases wherein commitments made in the RCEP Agreement need to be adjusted or addressed due to exceptional circumstances that affect our economy and industries, as well as our farmers. The RCEP negotiators acknowledged this possibility and therefore incorporated various mechanisms in the FTA that act as safety nets so that RCEP countries are able to address these circumstances. These are on top of the available measures to the Philippines under the WTO agreements”, he explained.

“Given this, our local industries including the agricultural sector should look at RCEP as a platform of more and bigger opportunities ranging from improved market access in the RCEP region, cheaper access to raw materials, wider cumulation area, trade facilitative measures, and even investments in smart agriculture and research and development”, Gepty added. 

In addition to the range of trade remedies, the RCEP Agreement provides enough flexibilities to cover, among others, emergency, essential security, and health and safety concerns through relevant provisions such as General Exceptions and Security Exceptions. This is in addition to some reservations made in the Philippines’ Schedule of Commitments. 

The provision on General Exceptions incorporates Article XX of GATT (1994)^[1] and Article XIV of GATS. Under this provision, RCEP countries such as the Philippines are not prevented from implementing measures that are necessary to protect public morals, human, animal or plant life or health, among others. There is also an article on Security Exceptions which states that RCEP countries are also not prevented from taking any action or measures considered necessary to protect essential security interest. There are also provisions that carve out Taxation Measures, as well as Measures to Safeguard Balance of Payments which allows Parties to adopt measures should they be in serious balance of payments and external financial difficulties or under threat thereof. 

Trade Secretary Lopez emphasized that the Philippines cannot afford to have an inward-looking trade policy, citing the impact on investor confidence should the country not accede to RCEP. 

“The Philippine economy is already well integrated into the global economy. Not joining RCEP will be catastrophic in terms of trade and investments.  The signal to the country’s trading partners and would be investors is negative as it conveys that the Philippines is embracing an inward policy, not to say protectionist stance. This is aligned with our current economic reforms and policy direction”, he said. 

In various engagements, trade officials cited the study conducted by Dr. Caesar Cororaton, which provides an insightful analysis on the Philippines’ significant gains from the Agreement. From the study, it was noted that the RCEP is estimated to improve the country’s trade balance by as much as US$ 128.2 Million, increase overall welfare by US$ 541.2 Million, contribute to a 1.93% real GDP growth, and lower poverty incidence by 3.62% in 2030. 

What happened in Beirut, Lebanon is too painful to accept.  The terrible tragedy was one that could have been prevented if not for the corruption of government officials that the Lebanese people have been fighting for it has been a bad habit so deeply embedded into the political system.

The explosion came from a warehouse loaded with 2,700 tons of ammonium nitrate, “a chemical compound with the formula NH4 NO3, and it’s made by combining ammonia with nitric acid.  It is most commonly used as fertilizer for agricultural purposes.”  But for some reason or another, the ammonium nitrate was held in the warehouse for a long, long time for years.  The port authorities just allowed these despite complaints against it knowing how dangerous and explosive the ammonium nitrate was.  Nagpabaya talaga.

Why the warehouse loaded with ammonium nitrate was allowed to be stored for seven years needs to be explained.  According to the news, it’s “under investigation.”

For years I have been hearing from my friends in Lebanon that corruption was rampant; and it became part of life in Lebanon.  High government officials have been used to seeing rallies and demonstrations to a point of accepting them as a way to ventilate the people’s frustration.  Said demonstrations and rallies were allowed and reached a point of becoming part of life in Beirut.

People just got used to such rallies and demonstrations.  The government officials have become too calloused that nobody was paying attention nor listening to charges of corruption anymore.  Manhid na sila.

According to some friends in Lebanon, one of whom was a classmate in the university in the U.S.; and a couple of doctor friends who told me that the government has the wrong attitude which has become part of life in Lebanon.  As Europeans used to say and turned into a song “Que sera, sera, whatever will be, will be…”  But that’s only regarding a love song.  But we are talking of deadly and explosive ammonium nitrate.

It seems that a song is strong enough to change the attitude of some poorly developed minds.

* * * * *

I was told that the wearing of the face shields if declared compulsory is quickly becoming big business.  Suppliers are hoarding, awaiting for the declaration making face shields compulsory for all, on or about August 15.   

It started at 20 pesos, gone up to 35, 45, 60 pesos and I found out, suppliers are hoarding for it can reach over a hundred after August 15.  We don’t know at what price it will finally settle down.

Pity the people.  Most of them are hard-up. Let the LGUs give them for free or peg the price at P20 or a little over.  Some LGUs might take advantage of the pricing.  They have been capturing the supply.  I hope that if they decide to give it to the people for free, hopefully, they account for it with the correct amount from the government funds.  And see to it that the face shields were actually given to the public or their constituents.

The people fear that the government will declare the use of face shields compulsory together with the surgical masks.  Investors are hoarding the face shield before they dump their supplies in the market, on or about August 15 when the announcement will come out making the wearing of face-shield compulsory once a person steps out of the house.

There will be two facial gadgets to wear by August 15, they say – the mask and the face shield.

Because of cottage industry or home-made face-masks, the price has gone down to a reasonable level for the face masks.  But a secondary requirement is coming out soon and many are speculating on the jacking up of the price for the face shields.

Since it is compulsory, the government through the Department of Trade must exercise price control for the poor people who will be victimized and taken advantage of.  I read in the newspaper, DTI Secretary Ramon Lopez said that the face shield must be approved by the Department of Health. Let’s hope the price is regulated like prices of canned goods and other items.  We are in very critical times.

Maawa naman tayo sa kapwa.  Sabi ng nakakaalam, tataas at tataas daw ang presyo.  Nag-umpisa sa 20 pesos, nagpabili ako para ipamigay, pero ang sabi nong inutusan ko ubos na raw at sa Divisoria ay 70 pesos each na daw.

According to information, the cost in China is only 8 to 10 pesos each, or 1 to 2 dollars each.  As to how much the Department of Trade will control the pricing, we do not know.  It’s the DTI that regulates the prices of goods, lalo na po dito sa face shield as it has been mandated by the government to be compulsory.  Honestly, the government must give these face shields for free to the people thru the LGUs to prevent speculation.  Otherwise, it will be a tremendous burden to our people for it has become a lucrative business and it should not be for it’s a government requirement and the government through the Department of Trade should be able to put the price on it to prevent speculators.

In Vietnam, face masks can be availed of by the people for free via ATMs.  The people can only press a button and out comes the mask.  Up to 5 per person.

Having been in government service myself for about a decade and a half, I’ve found out how government officials make money whenever there are calamities, typhoons, Dengue epidemic, SARS or what have you.  If we are not careful, this COVID 19 is another opportunity to commit corruption.  From the misery of the people, doon naman sila nagpapayaman.  Bastards talaga.  I cannot find another name to call them.  It takes a cruel person to do that.

There are government officials who find opportunities in such happenings to make money.  Terrible but true.

The Yolanda alone, just to give an example, most of foreign assistance ended up in the wrong hands.  Ang daming nangyari.  Mga foreign donations of canned goods were not given to the victims but sold and replaced with cheap goods.  Maraming ibenebenta sa Divisoria.

It’s a long story to tell.  May mga tao na masasama ang ugali.  Masakit sa kanila magbigay ng mga tulong sa ibang tao, so much so nabulok sa katatago nila that they rotted and had to throw them away by burying them.  It really happened, according to my police and military friends.

If only the military, the police and social workers could talk, you will not believe how cruel some people in power are.  It hurts them to give to the needy.  It’s an inborn disease.  They are takers, not givers.  The authorities know what happened to the Yolanda donations.  Parang may pumipigil sa kanilang puso tumulong.  Bakit ina-appoint ‘yang mga ganyang tao na “matapobre”?  Hindi dapat ina-appoint sa government positions.  Ganyan din ang nangyayari sa face-shields ngayon.

When I was appointed PCSO Chairman on January 21, 1994, I found out the corruption of my predecessor’s boardmembers and other heads of departments.  It’s a long story to tell.

Since then, I made it a practice during my term for a COA representative to join every medical mission that the PCSO often conducted.  It was a program I had implemented to have a medical mission every weekend to different barangays, complete with doctors, nurses, social workers, dentists to serve the community for free.  It was a very successful program most awaited by our people.

I trusted our medical teams and social workers, but I added extra protection of making one or two COA representatives to join our medical missions kasi po not only to ensure that the mercy mission is conducted honestly but free the PCSO from intrigues.

No one complained and the program ran smoothly for many years.  It was not only in Metro Manila but in the entire country for we authorized the PCSO managers in the different regions to conduct PCSO medical missions as well, with a COA representative, including the managers of the PDO, Provincial District Offices of the PCSO all over the country.

Sad to say, our successors in 2010 changed things around – for themselves ONLY!

* * * * *

Before I end this column, allow me to extend my deepest condolences to the family of the former Manila Mayor, former senator, former NBI director, and my good friend… more known as Mayor of Manila, Alfredo Lim.  He passed away last Saturday at the age of 90.

As Mayor of Manila, he often dropped by my place here in Quezon City.  He was a very thoughtful, considerate, and grateful person who never forgets how the Philippine Charity Sweepstakes Office (PCSO) helped his constituents of Manila; including the medical and hospital assistance extended to the people of Manila.

As I always told Mayor Lim, PCSO is there to serve the people of our country.  And indeed, we did from Batanes to Jolo, during our time.

Rest in peace.  God be with you.

For comments and suggestions email at mlmorato@yahoo.com

Japanese companies in the Philippines expressed optimism in the business climate in the Philippines based on the experience of the Japanese companies doing business in the Philippines.

Speaking to THEPHILBIZNEWS, Mr. Takashi Ishihara, Executive Director of JETRO Manila during the Philippine-Japan Joint Innovation for Inclusive Growth Seminar spearheaded JETRO MANILA in cooperation with Philippine Board of Investments held at Dusit Thani Manila, the JETRO Manila official revealed the positive experience of Japanese companies in the Philippines and how they see 2019.

“We conduct our 2018 survey on the Business Conditions of Japanese companies in Asia and Oceania, and we notice that the profitability of Japanese companies doing business in the Philippines remains good and we are very hopeful that this 2019 further increase is expected”, Ishihara said.

“The increase in profits are attributed to the sales demand and volume in both local and overseas market. Furthermore, the big improvement in production and sales have helped a lot. Given this scenario, we are hopeful that there would be more expansions to take place in 2019 and in the years to come”, he added.

When asked if there would be more Japanese investors to come in 2019, the JETRO Manila Executive Director said, “Certainly. But of course as some Japanese investors looking at the Philippines would like to really see some changes in the ownership of the company in the Philippines”.

This was also the concern brought up by the CEO of InstaLimb, Mr. Yutaka Tokushima, another Japanese company doing business in the Philippines during his presentation, who hopes that they (Japanese investors and prospective Japanese investors) would be heard on their request on the issues on deregulation on retail sales for foreign capital’s company, access to subsidy with Department of Trade and Industry and Department of Science and Technology in connection with innovation start-up, and product liability insurance be enriched.

There are many other new Japanese companies doing business in the Philippines like Global Mobility Service Philippines, who has been doing auto-Finance service for those who do not have access to financial loans. This Financial Technology (FinTech) company envisions to provide help to the ones with no financial opportunities and Generate employment in ASEAN countries and their young but dynamic Chief Operating Officer Mr. Kazumasa Nakashima was very optimistic with the Philippine market.

The Global Mobility Service Philippines looks forward to provide many more opportunities and stable economy through employment, cleaner environment and many more exciting programs in the pipeline.

Another exciting Japanese company involved in technology is the Global Market Business Development, Liquid Inc. Headed by their Country Manager, Mr. Kensuke Ochiai.

The Liquid Inc. has been establishing a system using “Biometrics Payment” through “Finger Print” that would provide efficient service and cut the operation time or process by half.

With this technology, Ochiai is hopeful to have many more partners establishments in both the private and government sectors thereby making it convenient for all the end-users.

Also, another Japanese technology in the Philippines is Informatix Inc. and its Leader for Sales Department, Mr. Shintaro Matsumara who made a good presentation about how to protect the valuable data using “cloud” based on Geographical Information System (GIS).

For his part, Mr. Masamichi Suzuki, Deputy Chief Representative of AEM-METI Economic and Industrial Cooperation Committee (AMEICC) from Bangkok Office, shared with THEPHILBIZNEWS that he is very confident that the ASEAN neighbors will continue to collaborate together in various projects in the new industries that would strengthen the ties between ASEAN countries and Japan.

Meanwhile, during the last part of the interview with Executive Director of JETRO Manila, Mr. Ishihara, he also noted that the Japanese Chamber of Commerce in the Philippines share the same positive view for 2019 based on their experience in 2018 and are hopeful that President Duterte would continue to work on the economic reforms and address some issues brought up not by Japanese companies or investors, but also the concerns of the Foreign Chamber of Commerce Associations in the Philippines.

The Philippine-Japan Joint Innovation for Inclusive Growth Seminar is organized by JETRO Manila together with Board of Investments, Department of Trade and Industry, Ministry of Economy, Trade and Industry, (METI) Japan, AEM-METI Economic and Industrial Cooperation Committee (AMEICC), The Association for Overseas Technical Cooperation and Sustainable Partnership (AOTS), Japan and Japan External Trade Manila, and supported by Japan Chamber of Commerce and Industry of the Philippines and The Philippine-Japan Economic Cooperation Committee, Inc. (PHILJEC). 

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