China FTA: How they do it in the Philippines

The China-ASEAN (Association of South East Asian Nations) negotiation of a “Comprehensive Economic Cooperation Agreement” is progressing slowly. In March 2003 China offered an ASEAN an ‘early harvest’ package of liberalization of agricultural products. But the Phlippines, an agricultural producer,has now rejected more than half of the proposed deal: bq. “China has offered 400 products under the proposed agreement and is prepared to open up its market to Philippine commodities, Agriculture Undersecretary Segfredo Serrano said. Department of Agriculture officials have trimmed the Chinese list down to 175 products to protect Philippine farmers, vegetable growers, and poultry raisers, he said. ‘They want to deny entry of Chinese vegetable, pork, chicken, rice and corn products’, he said”.  “(“Philippines Inquirer”:http://money.inq7.net/topstories/view_topstories.php?yyyy=2004&mon=08&dd=18&file=5 _emphasis added_) Philippines has been one of the promoters of the developing country demand for the right to continue protection for “special products“:http://www.inquit.com/article/268/flexibility-in-the-agriculture-negotiations in the WTO negotiations on Agriculture. The recent “Framework”:http://www.petergallagher.com.au:80/article/307/a-guide-to-the-wto-framework-agreement agreement concedes this mechanism, without saying what ‘special’ products are or how many products the developing countries will be able to excempt from future tariff cuts. This story tells us something about the Philippines objectives for the WTO as well as for the ASEAN-China FTA: it just so happens that they want to protect exactly the products that China specializes in producing (see my recent “paper(MS Word, about 270k)”:http://www.inquit.com/assets/public/ChinaFTA.doc on China’s agriculture trade). The Philippines Department of Trade and Industry claims that the Chinese offer of bilateral liberalization would have been more acceptable to the Philippines if the ‘early harvest’ package had included industrial products of export interest to the Philippines such as motor vehicle parts and microelectronics. The negotiations aren’t over yet, so we’ll see. But this may be shaping up as “another”:http://www.inquit.com/article/306/is-asean-integrating ASEAN trade agreement that lacks real substance.

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