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Groups unite to oppose RCEP trade agreement

The Manila Times logo The Manila Times 17/11/2021 Eireene Jairee Gomez

FORTY-EIGHT organizations of farmers, fishers, workers, civil society and business unanimously oppose the ratification of the Regional Comprehensive Economic Partnership (RCEP) trade agreement.

The groups urged the Senate to withhold its concurrence on the treaty, as they claimed it was finalized without consulting agri-fisheries stakeholders, who are directly affected by it.

"No more opportunity exists today to modify our commitments or the agreement's legal text," they said in a statement sent to The Manila Times. The RCEP is a multilateral trade agreement between and among Southeast Asian countries including the Philippines, China, Japan, South Korea, Australia and New Zealand.

The Senate Committee on Foreign Relations chaired by Sen. Aquilino "Koko" Pimentel 3rd recently started hearings that may lead to the ratification of, and formal entry of the Philippines into, the trade agreement.

​The opposing groups, however, explained that there is no clear and consistent basis for classifying agricultural tariff lines in the country's schedule of tariff concessions.

Joining RCEP, they noted, means that 75 percent of the country's 1,718 agricultural tariff lines will be set at zero. About 15 percent of tariff lines will undergo tariff reduction while 9 percent will be spared from any tariff change. The groups stressed that "a deeper analysis is needed to ensure that no mistakes were made, and that sufficient policy space remains to protect sensitive commodities." ​"More worrisome are rules that significantly hamper the application and effectiveness of trade remedies. These measures, such as safeguard duties, will be the only legal recourse against import surges and other problems engendered by RCEP's free trade regime," the groups said.

Moreover, the groups pointed out that RCEP strongly discourages quantitative restrictions, like suspending sanitary and phytosanitary import clearances during harvest periods. "Our Rice Tariffication Law also prohibits QRs (quantitative restrictions). Yet, [the] World Trade Organization (WTO) rules allow their temporary use under certain critical situations," they added. RCEP limits the allowable safeguard duty to the difference between a country's applied most favored nation (MFN) tariff and the RCEP tariff in effect when the safeguard remedy is invoked. For instance, if the applied MFN tariff for a product is 35 percent, and the country's tariff commitment under RCEP is down to 25 percent when an import surge occurs, the safeguard duty cannot exceed 10 percent.

"Ironically, sensitive products like rice, corn, and some fishery and livestock products (which RCEP exempts from tariff reduction) might lose safeguard protection, since their tariff during RCEP's implementation could already equal their applied MFN tariff," the groups said. This, they further noted, is a big departure from WTO rules, which permit any remedial duty necessary to prevent or rectify serious injury to a particular sector. The groups also highlighted that the imports from least developed countries (like Myanmar, Cambodia and possibly Vietnam) are exempt from safeguard duties under RCEP rules, noting that there is no such exemption exists under WTO.

"We question the rosy projections about RCEP membership, and the purported losses if we stay outside the trade bloc. There were such assertions before, starting with the General Agreement on Tariffs and Trade-Uruguay Round Agreement and subsequent regional and bilateral trade agreements. These optimistic forecasts have not materialized. Performance data instead show our deteriorating terms of trade — minimal increases in exports, reliance on traditional commodities, ballooning imports, and widening trade deficits," the groups elaborated. "Our prospects will likely not improve under RCEP. Claims regarding RCEP benefits are therefore overly presumptive, highly misleading and manifestly deceptive," it added.

Some RCEP advocates are warning that the Philippines will be "left behind" should the country fail to join RCEP by year-end. But opposing groups claimed it is "uncertain" that the RCEP will actually bring Philippines its desired outcomes.

They asserted that "the agri-fisheries sector has generally not benefited from free trade agreements while our competitors have increasingly dislodged us from export markets with superior and cheaper products. Moreover, these trade pacts have pried open our economy, causing import surges, price depressions and displacement of local production." "We will never gain from RCEP unless we establish, fund and implement dedicated and sustained programs to boost the competitiveness and profitability of our agri-fisheries stakeholders. It is also nonsensical to promote RCEP membership when the benefits from this "good agreement" are essentially theoretical or imagined, whereas its dangers are real and validated from experience," the groups added.

In all, the groups said the Philippines' bilateral and regional free trade agreements with all RCEP member countries will remain in force even without RCEP. "We will still enjoy opportunities available outside RCEP. We can continue negotiating with our free trade agreement partners to secure additional advantages that are comparable to RCEP's."

Among the major groups joining the opposition force are the Federation of Free Farmers, Agricultural Sector Alliance of the Philippines Inc., Alyansa Agrikultura, United Broiler Raisers Association, Philippine Maize Federation, Pork Producers Federation of the Philippines Inc., Rice Watch Action Network, Samahang Industriya ng Agrikultura, Kilusang Magbubukid ng Pilipinas and Anakpawis party-list.

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