DTI bucks liberalization of investment policies

Trade and Industry Secretary Manuel Roxas II will continue to resist the move of some countries to link the resolution of agriculture issues with the so-called Singapore Ministerial Conference (SMC).

He labeled the linkage as "devious."

Roxas was surprised that the resolution of issues on agriculture and SMC were linked in the recently concluded World Trade Organization (WTO) 5th Ministerial Meeting in Cancun, Mexico.

The SMC issues involve liberalization policies in the area of investment, government procurement, transparency and trade facilitation.

Of the four issues, the most critical, at least for the Philippines, is investment.

Liberalization of investment policies would essentially mean that sovereign countries would no longer be able to discriminate or prioritize the entry of investments.

This means that any foreign investor that wants to come in would no longer have to go through the Board of Investments which currently screens investors and prioritizes which investment it wants to allow as part of the Philippine government’s development plan.

"We must be allowed to determine our own domestic policy," Roxas said.

Market itself, Roxas said, would push the reform.

He added that "it is not a capricious position to bargain away."

"We want trade facilitation and transparency, but it cannot be done through an outside imposition," Roxas said.

On the non-agricultural market access (NAMA) text to which the Philippines also objected, Roxas said that "it is not something we want to be trading away later on. We need adjustment from the headlong rush to liberalize. We already paid for this through the early harvest."

Under the draft Cancun ministerial text, WTO members would again have been subjected to a new round of tariff cuts.

The problem for the Philippines is that it had much earlier lowered its tariff rates compared to other countries and is now putting on the brakes especially since domestic industries have already borne the brunt of the earlier tariff cuts.

Roxas assured he would continue to resist new tariff cuts.

"There should be no reduction (especially for unbound tariff lines) and that binding in itself is already a concession," he said.

On the agriculture issues, the Philippines is also against several of the provisions that would further open up the Philippine market to foreign agriculture imports.

The revisions to agriculture market access are actually for the benefit of the US which is trying to gain access to the European Union market.