Sen. Imee scrutinizes ‘controversial’ RCEP provisions prior to possible ratification

The Philippines is the only founding member of the free trade bloc, Regional Comprehensive Economic Partnership (RCEP), which has not yet ratified the treaty, but the Senate foreign relations committee is not inclined to recommend sending the treaty to plenary yet without assurances from the Executive department that the agriculture and micro, small and medium enterprises are given protection from potential unfair competition.

Foreign Affairs Secretary Enrique Manalo told the Senate Foreign Affairs Committee hearing Thursday that Indonesia became the latest member-country of RCEP, which has ratified the free trade agreement (FTA) last week.

RCEP is an FTA among the 10 members Asean, China, Japan, South Korea, Australia and New Zealand. It entered into force last January 1, 2022 among 11 members.

The largest trade deal, RCEP covers roughly 50.4 percent of the Philippines’s  export market and 67.3 percent of the country’s import sources.

Senator Imee Marcos, chairperson of the Senate Foreign Relations Committee, said farmers have complained to them that the “downfall of the agriculture” started when the Philippines joined the World Trade Organization (WTO) in 1994.

“There are two things that need to be addressed—with the deregulation of our industries, the DA has an unparalleled wreck of reckless importation. Takot na takot ang mga stakeholders, mula sa pinakakaliwa hanggang sa pinakakanan na grupo. Ang mga nagtatrabaho sa pagsasaka, talagang galit na gait na sa RCEP. They have data to prove it. Second, the problem with modernization, for agriculture to level up like mechanization, better seed, etc.,” Sen. Marcos said.

“Unfortunately, we simply cannot drum up the votes until these two issues are concerned,” Marcos added.

She said the Philippines should have the leeway to regulate entry of foreign goods, even with accession to RCEP.

The DFA said even without RCEP, the Philippines has already concluded FTAs and the tariff lines of the Philippines are already low from products with Asean and other dialogue partners like Korea, Japan, China, Australia and New Zealand.

“Most of our imported goods from RCEP members are intermediate materials, more than half of them. And the final goods are only 15 percent. As for agriculture, the RCEP does not cover the sensitive goods like rice, corn. We did not make commitments,” DFA Assistant Secretary Gina Jamoralin explained.

Trade and Industry Assistant Director Marie Sherilyn Aquia said non-sensitive products like industrial goods, parts of machineries will no longer be levied with tariffs within the first 10 years of the RCEP implementation.

Jamoralin added that there is a chapter in RCEP for safety measures.

“In case of a surge of imports to the Philippines from any of the RCEP member countries, the affected countries can also do remedies to prevent further injury to the domestic industry,” Jamoralin said.

The procedure for safeguard procedure is similar to the WTO—a complaint will be submitted by the affected industry, and an investigation will be made by the Philippine government to determine if there is indeed an “injury” caused to the domestic industry by the entry of imported goods to the Philippine market.

Sen. Marcos acknowledged that the issue raised by agricultural sector could be attributed to the failure of the government to implement the provisions for safety net measures.

“Kasalanan naman natin. Nandyan naman sya [safety nets]. We could invoke it. Kulang lang tayo sa reklamo, Ang dating lang sa kin, nandyan naman pala. We don’t use it. We are not as aggressive as countries like Japan or Korea. Whereas we just let things slide,” she added.

Manalo said any inputs from the Senate on amendments to the agreement can only be introduced if the Philippines is already a member, with the Philippines officially concurring with the treaty.

“In one of the provisions [of RCEP], it says any amendments to the present agreement, it can only be made by the parties of the agreement. If we try to raise the points that you mentioned, we cannot propose amendments because technically we are not a member,” Manalo said.

Marcos is asking the Department of Trade and Industry and Department of Agriculture to submit a list of products produced by the Philippines, which will be affected by entry of imported products by RCEP members. “I need your help to explain to these stakeholders what’s in it for them, and what they don’t need to fear,” she added.