"The liberalization of the health sector will allow (Filipino) nurses and caregivers to Japan," said Tereso S. Tullao, an economist from the De La Salle University, during a briefing at the National Economic and Development Authority (NEDA).
He said the economic agreement between the two countries will pave the way for the restructuring of Filipino migrants to Japan. Instead of sending entertainers who have short contracts and are prone to abuse, Filipinos could send professionals.
"Under the agreement, Japan, for the first time, will be accepting foreign careworkers to take care of their elderly," Tullao explained.
He noted that by 2010, 37 percent of Japan’s population will be aged 55 or over. This means that Japan ‘s labor force will dwindle thereby increasing its demand for foreign workers.
A government study has concurred with Tullao and has enumerated the benefits of the partnership. In a paper assessing the JPEPA released by the Philippine Institute for Development Studies (PIDS), it said opening the labor market will not only increase remittance, it will also provide a venue for technology transfer and cooperation which could in turn facilitate improvements in the competitiveness of workers.
The paper also noted the strong economic ties shared by the two countries given that Japan is the Philippines second largest trading partner. In 2000,
Japan accounted for 14.73 percent of total Philippine exports and 19.1 percent of total imports. Also, Japan is currently the largest source of foreign direct investment in the country.
"The Philippines remains an important potential market and a potential export base for Japanese companies planning to operate in the Asian market," the paper said.
Looking at the cost of JPEPA the paper added it would be very expensive for the country not to sign the deal. Under the JPEPA, tariffs-considered as trade safeguards will be decreased slowly until it is reduced to zero.
Aside from noting that the industrial tariff is already small, the paper said the foregone tariff revenue of around P3 to P5 billion will be offset by the additional tax revenue due to the increased economic activity brought by the partnership.
"Simulation results show that the
Philippines would lose around 0.04 percent of GDP (gross domestic product) if we do not forge an FTA (free trade agreement) with Japan while Thailand does," the paper noted.
JPEPA is a partnership that will include a possible free trade agreement and other components covering services, investment, human resources development and other forms of cooperation.