THE GOVERNMENT’S economic managers will reconsider the Trans-Pacific Partnership (TPP) in light of US President Donald J. Trump’s renewed interest in the trade bloc, though the business sector wants competitiveness to improve before the country signs any free trade agreements (FTAs).
“We will certainly consider it. If one of your biggest partners is not going to join, why will we go to that party? We’ll see what the score is, but there is also RCEP (the Regional Comprehensive Economic Partnership),” Finance Secretary Carlos G. Dominguez III told reporters on Friday on the sidelines of the Philippine Economic Briefing in Clark, Pampanga.
He was reacting to reports of the US reconsidering the trade deal after Mr. Trump said in a social media post that it will only join if the deal’s terms were “substantially better” than that offered to his predecessor.
Socioeconomic Planning Secretary Ernesto M. Pernia, meanwhile, said that the country’s bid to join the TPP is “still in process,” but noted that the Philippines is “surer about RCEP than TPP, given the fickleness of Trump…you can never be sure.”
On March 8, 11 Asia-Pacific nations signed the agreement without the US — and renamed it the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) — effectively lowering trade and non-trade barriers and at the same time requiring its members to comply with good governance, environmental, intellectual property, and labor standards, among others.
The TPP was initially a strategy by President Barack Obama to expand US influence in Asia, before Mr. Trump pulled out in January 2017.
George T. Barcelon, President of the Philippine Chamber of Commerce and Industry (PCCI), meanwhile, said that despite the possible re-entry of the US — which he called not likely — the Philippines will face challenges in complying with the deal.
“I think they may not give it to the US. The TPP was something on the table before, and complying is also quite challenging. We have to be prepared, we have to be competitive… What’s important is for us to be in a position to be competitive before we open up,” Mr. Barcelon said in a phone interview yesterday.
“On the TPP, there is concern in our agriculture sector. For the last decade, it has not been growing that much, it’s not been given much attention (compared with the rest of) ASEAN (Association of Southeast Asian Nations),” he added.
Philippine Exporters Confederation, Inc. President Sergio R. Ortiz-Luis, meanwhile, said that the Philippines should likewise ask for a better deal if it continues with its bid to join the CPTPP, but nevertheless said that industry can still benefit from the China-led Belt and Road Initiative and RCEP, which is more likely to materialize.
“We have concerns about the many conditions that are being set that could be very expensive for us to come in. Provided that the conditions are better and aren’t expensive, we can come in,” he said in a separate phone interview.
“But still, Belt and Road offers easier entry, and no cost. For RCEP, we’ve been trying to do our best,” Mr. Ortiz-Luis said.
“But with or without the TPP, we’re doing well with China, and will enjoy benefits from Belt and Road,” he added.
Mr. Barcelon added that there is more visibility with RCEP, and expressed a preference for forgoing efforts to join the CPTPP as the Philippines enjoys other bilateral trade deals with Europe and possibly the US.
“We still have the European Union GSP+ (Generalized Scheme of Preferences Plus) and a possible FTA with the US.”
“In the meantime, we should grow our manufacturing base… I think we should have the mind-set that we’re part of global trade, and we should prepare ourselves for competition,” he added.
Mr. Ortiz-Luis added: “we’ll just try to make the best of it, considering that in the region we have similar products. I think we should really try to look what our competitive advantage is in this area and pursue it. — Elijah Joseph C. Tubayan