MANILA, Philippines - The Philippines needs to liberalize its economy, if and when it decides to join the Trans Pacific Partnership (TPP) agreement, an American business federation said.
“If the Philippines decides you want to do it (TPP), my advice would be to move, start liberalizing as quickly as possible because you will have to go to each of the current 12 partners and get their support. It has to be unilateral. All 12 have to agree,†US Chamber of Commerce vice president for Asia Tami Overby told reporters on the sidelines of the 2014 Asia Pacific Council of American Chambers Spring Summit yesterday.
She noted that as the US and 11 other Pacific countries such as Australia, Brunei Darussalam, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam are in negotiations for the TPP, the Philippines needs to watch closely to determine whether being part of the agreement is in line with its national interest.
This, as she noted that joining the deal would entail commitments to high-level standards and market liberalizing measures.
The TPP aims to establish a free trade bloc which would represent more than half of global output and over 40 percent of world trade.
It sets standards for intellectual property, labor rights and environmental protection.
Overby said the Philippine Constitution’s restrictions on foreign ownership has to be looked into when the country decides it wants to be part of the TPP.
US Ambassador to the Philippines Philip Goldberg said in the same event that while there is growing interest in the business community for the Philippines to be part of the TPP, it is up to the government to decide whether taking part of the deal would be advantageous.
Finance Secretary Cesar Purisima acknowledged that the Constitution’s restrictions are among the challenges faced by the country in joining the TPP.
“We’re working with Congress on things we can do without changing the Constitution,†he said.
President Aquino has been firm in his stands on moves to amend the Constitution under his term.
Trade Secretary Gregory Domingo said earlier that while the Constitution’s limits on foreign ownership in certain sectors are not seen to meet the standards of TPP members, the Philippine government intends to seek flexibility to be allowed to join the pact.
“We will just have to negotiate so we will not have to do that (amend the Constitution),†he said.
Overby said seeking flexibility may not be an option once the negotiations are concluded and rules have been set by the members.
She said though that a longer period of transition to meet the high standards may be given.
“We will help the Philippine government learn about the processes so we will help them modernize their economy. It’s politically difficult to do but long term, from a competitiveness standpoint, its very smart in my opinion,†she added.