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Philippines missing out on RCEP opportunities
MANILA, Philippines — The Department of Trade and Industry (DTI) emphasized anew the importance of taking part in the Regional Comprehensive Economic Partnership (RCEP) agreement, saying the country’s Southeast Asian neighbors are already enjoying the benefits of the mega-trade deal.
“We cannot afford to delay or not participate in this FTA (free trade agreement) deal when our ASEAN (Association of Southeast Asian Nations) neighbors are already reaping the advantages of the agreement with partners. And they are already benefiting from it,” Trade Secretary Ramon Lopez said during a forum organized by the DTI on the benefits of participating in RCEP.
The forum, which also served as a venue to discuss concerns raised by stakeholders, particularly the agricultural sector on joining RCEP, was attended by members of the Philippine trade negotiating team, experts from the government and academe, Sen. Cynthia Villar, as well as over 60 legislative staff of the Senate.
Among those already starting to take advantage of opportunities from RCEP are businesses in Singapore.
Lopez said Singapore’s trade minister recently announced that local businesses are already exploring opportunities opened by RCEP through the additional preferential market access gained from China and Japan for mineral fuels, plastics, chemical products, food preparations and beverages, among others.
He said in a Viber message that while it may be too early to tell if there are projects or investments secured by Singapore via RCEP that otherwise were for the Philippines, such may happen if the country’s completion of the ratification of the RCEP is further delayed.
“Delayed participation in RCEP may send concerns to the business sector of the openness of the Philippine economy, and may divert to other economies the trade, investment, and other economic opportunities that the RCEP may bring,” he said.
Trade Undersecretary Ceferino Rodolfo cited an article from the Japan External Trade Organization dated March 29, on Thailand’s RCEP utilization leading to about 4 billion yen or about P1.7 billion of exports in just two months after the entry into force of the agreement.
As Thailand’s stakeholders that are are benefiting from the RCEP are competing with Filipino exporters in the Japanese and Chinese markets, he said opting out of RCEP would be a disadvantage to Philippine exporters.
Trade assistant secretary Allan Gepty, who served as the Philippines’ RCEP chief negotiator, emphasized the Philippines cannot afford to miss out on RCEP as non-participation would be inconsistent with the country’s trade policy direction.
This, as the Philippines recently approved economic reforms such as amendments to the Foreign Investments Act, Public Service Act, and Retail Liberalization Act to open and liberalize the market to make the country more attractive to investments.
Agriculture assistant secretary Noel Padre discussed the potential benefits of RCEP for the agriculture sector through the improved tariff concessions secured from China, Japan, and Korea for agri-fishery products like canned pineapple, papaya, and chocolate.
He also said local manufacturers and exporters of canned tuna, would gain from the eased rules of origin under RCEP.
For his part, Cielito Habito, professor of economics at the Ateneo de Manila University and chairman of Brain Trust Inc., said the country’s hesitancy in ratifying RCEP sends negative signals to the international community and reinforces the historical reputation for tentative policy setting.
Such could lead to foreign investors skipping the Philippines when it comes to trade and investment since it would be easy for them to go to the more decisive neighbors.
Habito also said the delay in ratification based on illusory threats would be costly to industries.
RCEP, which creates the world’s largest free trade area, entered into force last Jan.1 for Brunei Darussalam, Cambodia, Lao People’s Democratic Republic, Singapore, Thailand, Vietnam, Australia, China, Japan, and New Zealand, while it took effect last Feb. 1 for South Korea, and March 18, for Malaysia.
In the Philippines, the RCEP was ratified by President Duterte last Sept. 2, but it still needs to be given concurrence by the Senate.
Lopez earlier said the DTI was hopeful the Senate would give its concurrence on the RCEP within the current Congress.
Source: https://www.philstar.com/business/2022/04/19/2175040/philippines-missing-out-rcep-opportunities