‘Costly’ missed opportunities from RCEP delay
THE Department of Trade and Industry (DTI) said the Philippines cannot afford further delay in joining the Regional Comprehensive Economic Partnership (RCEP) trade agreement.
“The Philippines is the remaining signatory state that has yet to participate in this important trade deal, and this time the Philippines cannot afford not to join. It will be costly, we will miss a lot of opportunities,” Trade Secretary Alfredo E. Pascual said in a statement on Monday.
“Our neighbors in South East Asia are already enjoying the advantages and benefits of the agreement, and further delay can result in… missed investment opportunities,” he added.
Touted as the world’s largest free trade agreement (FTA), the RCEP started coming into force in the various signatory countries on Jan. 1, 2022. The participants include the 10 members of the Association of Southeast Asian Nations (ASEAN), Australia, China, Japan, South Korea, and New Zealand.
The Philippines is the only country that has yet to ratify RCEP, as the Senate was unable to give its concurrence in the previous Congress over concerns from the agriculture industry over lack of protections from competing imports.
Former President Rodrigo R. Duterte signed the RCEP agreement in September 2021, leaving the Senate to provide its concurrence.
The Senate Committee on Foreign Relations is set to conduct a hearing on RCEP on Feb. 7.
According to Mr. Pascual, reluctance to join the RCEP gives off a negative impression of Philippine trade policies.
“The Philippines has only a few FTAs compared with other competing ASEAN countries. Suppose our country is seen as reluctant to join this regional trade agreement spearheaded by ASEAN itself, such reluctance would raise many questions about the direction of trade policy.”
He added that participation in RCEP assures foreign investors about the government’s commitment to free trade, adding that the FTA will enhance the Philippines’ bid to position itself as an “ideal investment destination in the East and Southeast Asian region.”
“The Philippines cannot afford not to be part of this mega free trade agreement,” Mr. Pascual said.
“Our country has already implemented game-changing economic reforms. RCEP will complement these reforms and strengthen the country’s enabling environment for business. This regional pact will open a wide range of market opportunities for investors, particularly in export-oriented enterprises, in this era where the center of economic activities is in the region,” he added.
“Our approach to trade and investment policy is holistic, and we cannot afford to just focus on certain sectors. Our goal is a vibrant, sustainable, and resilient economy not only for businesses and investors but for the general welfare,” Mr. Pascual said.
Trade Assistant Secretary Allan B. Gepty said that the concerns of the agriculture industry are addressed by the RCEP deal, which permits resort to trade remedies prescribed by the World Trade Organization (WTO).
He noted the availability of RCEP transitional safeguards to address increased imports and protect domestic industry.
Participating countries are allowed to suspend the further reduction of customs duties or increase such duties following a surge in imports to address injury or even the threat of injury to a domestic industry.
Mr. Gepty added that there are also anti-dumping and countervailing measures that reaffirm the participating countries’ rights and obligations under relevant WTO agreements.
“In the course of negotiation, we made sure that concerns of stakeholders are well covered and appropriate flexibilities or policy space are provided in the agreement,” Mr. Gepty said
“As we move forward, our local industries, including the agricultural sector, should look at RCEP as a platform of more and bigger opportunities. These opportunities can range from improved market access in the RCEP region, wider cumulation area, cheaper access to raw materials, trade facilitative measures, innovation, and more investments, especially in smart agriculture and research and development,” he added. — Revin Mikhael D. Ochave