Friday, January 25, 2008

Statement by the Task Force Food Sovereignty

The Task Force Food Sovereignty (TFFS)* strongly condemns the recommendation of Senators Mar Roxas and Miriam Defensor-Santiago to ratify the highly flawed and unequal Japan-Philippines Economic Partnership Agreement (JPEPA). Inspite of the strong Constitutional and legal arguments against JPEPA and the studies of various groups that will be affected negatively by the agreement, the two Senators chose to hear out and favor the position of Japanese monopoly capital, the Philippine big business and the Arroyo administration.

JPEPA is a blatant surrender of the country's sovereignty. It wrests away from the Philippine govern­ment the sovereign right to decide on national and local policies and legislation. JPEPA also violates the Constitutional restrictions on foreign ownership and activities in key areas of our economy including our national patrimony. It allows the full entry of Japanese multinational companies in crop plantations, fishery, mining, power, etc, depriving the Filipinos the prior right and access to their land and other productive resources.

The losses depicted by Senator Roxas, if the Senate rejects JPEPA, are purely speculative. Japa­nese foreign direct investments have poured into the country even without JPEPA. However, much of these investments only went to import-dependent assembly factories like those in the electronics and automobile parts industries and increased the profits of Japanese firms, but have very limited contribution to strength­ening the country's manufacturing base.

Further, Senator Roxas' fears that the Philippines will be left out from the bandwagon of free trade again are the same arguments put forward by then Senators Angara and Gloria Macapagal Arroyo when they ratified the country's membership to the World Trade Organization. But after more than a decade, the WTO has not created the huge markets and the employment increases it promised. Even the trumpeted gains of the ASEAN Free Trade Agreement (FTA) are nowhere to be seen, as intra-regional trade expanded very little in the last three decades.

Even Senator Roxas conceded that the trade benefits from JPEPA are minimal. At present, about 83% of the value of total Philippine exports to Japan already enjoys zero duty, of which 82.13% are industrial products and only 0.84% agricultural. Upon JPEPA's enforcement, only an added 6% of the current total value of Philippine exports to Japan (that are not zero duty) will be opened up, bringing to 89% the share in total exports under duty free status. Only 1% of the 6% miniscule gain comes from agriculture. Almost all of the 11% of the value of exports that were not granted duty free but merely given some token reduction of tariffs are in agriculture!

This is an outcome of a highly unequal agreement borne out of opportunistic and un-transparent nego­tiations. JPEPA gave the Japanese the leeway to protect more than 200 of its agriculture tariff lines but reduced starkly the Philippine policy space when our government merely exempted two products from tariff elimination.

Moreover, JPEPA failed to reduce the stringent sanitary and phyto-sanitary measures employed by Japan to discriminate against Philippine agriculture exports, thus, rendering inutile whatever market access the Philippine government has negotiated.

Clearly, the odds are stacked against the claimed benefits. Much of the gains are imaginary, but the losses are real in terms of job displacement, loss of sovereignty and policy space, worsened poverty for rural people who will be driven away from their land and natural resources, and environmental destruction result­ing from increased dumping of toxic wastes and mineral extraction.

Thus, we appeal to the Philippine Senate to seriously consider the major losses our country and our people will incur from JPEPA, particularly the poor Filipino farmers and fishers, who comprise the bulk of our agriculture producers:

1. The miniscule market access gained in agriculture, if any, is found in the high value export crop sector which is dominated by large firms affiliated to Japanese multinationals such as those in banana, pineapple, mango, asparagus, etc. This means drawing away limited government support in agriculture to these crops, again depriving the millions of rice, corn and coconut farmers many of whom are into
subsistence farming the needed financial, technical and infra­structure support.

2. Filipino artisanal fishers as well as small handliners will face undue competition if and when cheapened marine and fishery imports from Japan come in as a result of the reduction and elimi­nation of tariffs on such products like yellow fin tuna, mackerel, milkfish or lapu-lapu fry, squid, shrimp that will come in at zero duty upon JPEPA's enforcement. Japan is highly competitive in marine and fishery sector, owing to its modern fishing fleets and advanced technology.

3. JPEPA allows unrestricted Japanese investments including equal rights with Filipino nationals in owning agricultural lands and in exploiting the country's natural resources particularly marine resources and those found under the continental shelf. It will not not only violate the Philippine Constitution but it will also exacerbate landlessness, inequality and poverty in the country.

4. Rural industrialization will be stunted as Japanese processed agricultural and semi-agricultural products will enter the domestic market with zero or reduced tariffs, thereby creating disincen­tives for small and medium-scale enterprises. Moreover, Japanese investments in this area are already competing with domestic firms with limited capital and relying on backward technology.

5. Since JPEPA is a template for free trade agreements, there is no stopping other developed coun­tries such as the US and the EU, whose agricultural exports are several times bigger than that of Japan, to negotiate the same trade preferences that the Philippine government inked out with Japan, invoking the most favored nation treatment. Since all Philippine agriculture tariffs are already committed to zero, except for rice and salt, what then is left to protect our small-scale producers
from these heavy agriculture subsidizers?

We call on our Senators to heed the call of the people, particularly those who have been unduly dis­advantaged by our external trade policies and our continued kowtowing to foreign interests. Besides the impact on rural livelihoods, small and medium-sized enterprises and the environment, JPEPA will also stunt, if not totally demolish, the long-term development and industrialization of the Philippines.

By opening up all areas of the economy to Japanese investments and removing all performance requirements imposed on Japanese investors under present laws, the country will be seriously constrained to direct and regulate foreign investments in accordance with its development priorities.

In the light of the dismal failure of globalization to lift the Filipino poor from poverty and hunger and in the light of an impending global economic recession, blind reliance on free trade and the global market is certainly not the answer to our domestic problems. We urge our honorable Senators to instead hear out the sentiments of our small farmers, municipal fishers, indigenous peoples, and other rural poor sectors whose livelihoods, land, and water resources may be put into peril by this

Reference: Ms Arze Glipo - 925-0987

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