US sets condition for retention of RP garment quota

The Philippines is optimistic that the US will agree to allow the country to continue availing of the six-percent carry-over on garments quota allocation for this year provided that the government agrees to return to the negotiating table on the stalled World Trade Organization (WTO) talks and begin discussion on some of the so-called Singapore Ministerial Conference (SMC) issues.

According to Garments and Textile Export Board (GTEB) executive director Serafin Juliano, the Philippines had requested that it be allowed to continue to avail of the carry-over provision this year even though the garments quota regime is set to expire this year.

The Philippines has even hired Washington-based consultants to lobby the Philippines’ request.

The response from the US government, Juliano said, in turn is for the Philippines to return to the WTO negotiating table and start discussion on the SMC issues which the Philippines had been against during the failed WTO talks in Cancun, Mexico last year.

"Discussion of the SMC issue is one possible expectation although we are trying to isolate that because of the sensitivity of garments," Juliano said.

The SMC issues involve liberalization of policies on trade facilitation, investments, government procurement and competition.

The Philippines maintains the stand that it must be independent in setting internal policies on investment, government procurement and competition.

However, during a recent meeting of Trade and Industry Secretary Cesar V. Purisima with US Trade Representative Robert Zoelick, there appeared to be a softening on positions with the US willing to limit discussion just on trade facilitation.

In a related development, Juliano indicated that the Philippines may not be as successful in getting the $300 million in compensation that it is seeking from the US as a result of the move of the US on imposing rules of origin (ROO) on garments.

The ROO determines the quota allocation based on the origin of the textile used in the garment. – Marianne Go