Phl told to boost domestic conditions

CEBU, Philippines - To prepare the country for the upcoming Asean Economic Community (AEC) in 2015, the Philippines needs to improve its domestic conditions, upgrade its capability and ease domestic constraints in order to fully maximize the benefits of regional trade agreements (RTAs).

Further, the country needs to be open to the possible negative impacts of being left out from certain RTAs and missing out opportunities from positive investment and trade creation as a result of joining RTAs.

This was raised by the Philippine Institute for Development Studies (PIDS) senior researcher Dr. Erlinda Medalla who advised Philippine companies to be open to possible RTAs but reminded them to stay cautious and selective in choosing their partners at the same time.

With its vision to create a single Asean market and production base, the Asean integration process is intended to address core issues such as small market, transactions costs, policy consistency and stability and domestic issues, particularly those related to priority integration sectors.

Medalla then said that AEC justifies liberalization and investment facilitation as an attraction to foreign direct investments.

She cited a survey that 72 percent would expand their businesses in the Philippines, about 60 percent of which identify Asean as a significant factor in investment decision.

Since services could be considered as one of the Philippines’ strength, she said that trade liberalization in services has been negotiated under the Asean Framework Agreement on Services (AFAS), which primarily focuses on key priority sectors such as air transport, e-Asean, health, tourism and logistics.

AFAS shall also cover the liberalization of business services, professional services, construction, distribution, education, environmental services, healthcare, maritime transport, and telecommunications.

In terms of advancing the free flow of labor, Medalla cited that the mutual recognition arrangement (MRA) for seven professional services has been completed.

The seven MRAs ensure the mobility of professionals across the region while each Asean member state maintains its rights to implement its own regulatory function on professional services.

These seven major professional services include engineering, accountancy, nursing, dentistry, medicine, architecture and surveying.

The MRA for tourism professionals, on the other hand, has been recently implemented by the Department of Tourism in preparation for the Asean integration.

At present, there are six labor divisions where tourism professionals may find employment in Asean-member countries: front office, housekeeping, food production, food and beverage services for hotels, travel agency, and tour operations for travel services.

The tourism professionals could find employment in Asean-member countries through the six labor divisions namely front office, housekeeping, food production, food and beverage services, travel agency, tour operations.

For 2015, Medalla reminded both the government and private sector to focus on the priority AEC measures such as tariff and non-tariff measures, trade facilitation, services liberalization and domestic reforms, investment liberalization and facilitation, and connectivity and transport facilitation.

She also said that other AEC measures that are equally important and attainable beyond 2015 include the standards and conformance, capital market development and financial market integration, mutual recognition arrangement (MRA) on professional services and labor mobility, information and communications technology, energy, competition policy, and agriculture among others. /JMD (FREEMAN)