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Fishy issues in Japan-Philippine Economic Partnership Agreement (JPEPA)

The Japan-Philippine Economic Partnership Agreement (JPEPA) is up for ratification

by the Philippine Senate. However, there are socio-environmental and equity issues
on fisheries trade and investments that demand answers or solutions from
policymakers of both countries.

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Fishy issues in Japan-Philippine Economic Partnership Agreement (JPEPA)

Jaime Escober, Jr., Tambuyog Development Center

31 May 2007

The Japan-Philippine Economic Partnership Agreement (JPEPA) is up for ratification

by the Philippine senate this year. However, there are socio-environmental and
equity issues on fisheries trade and investments that demand answers or solutions
from policymakers of both countries.

The Japan-Philippine Economic Partnership Agreement (JPEPA) is a comprehensive

economic agreement that puts the Philippines at a serious disadvantage. It poses
several socio-environmental and equity issues that have grave implications on the
well being and future of the Filipino people.

Threat of overfishing and fisheries collapse

While there is no fishery access agreement with Japan and the Philippines,
Japanese commercial fishing may be allowed under JPEPA terms because in its
definition of "Area" (Article 2) where investments and services may be undertaken
includes the territorial waters of the country and its Exclusive Economic Zone.

It should also be noted that even without JPEPA, foreign investment is already
allowed in commercial deep-sea fishing under the Philippine Foreign Investments
Act of 1991, provided that foreign participation does not exceed 40 percent.

As in previous years, the fisheries sector is again listed in the 2007 list of
investment priorities of the Philippine government. Alongside shrimp and other
aquaculture products, tuna�a product of commercial fishing�tops the list of
priority products for exports.

This is an incentive that, coupled with JPEPA, can lead to increasing commercial
fishing activities in the coming years. This development will have adverse impacts
on the sustainability of local marine resources that, according to experts, have
reached their maximum sustainable yield back in the 1990s and are now increasingly
overfished. The threat of eventual collapse of local fisheries is serious given
the persistence of an open-access regime in the country.

In aquaculture, Japan has been a leading export destination of local shrimp

products since the late 1980s. But the socio-environmental costs of intensive
shrimp farming in the country have not been properly addressed up to the present.
JPEPA says nothing about addressing such costs.
It is interesting to see if JPEPA would spur Japanese investments in local shrimp
farming (and in other aquaculture products), thus helping the local shrimp
industry to recover after almost 10 years now of low productivity and diseases.
But again, the downside would be the threat that the massive socio-environmental
costs in the 1980s and 1990s would be repeated.

Unfair JPEPA provisions: national treatment, non-transfer of technology

Certain JPEPA provisions are unfair. For instance, national treatment applies to
Japanese goods, investments and services (Articles 17, 73 and 89) which means that
they should be given the same and equal treatment as that received by their
Filipino counterparts in the country. This treatment runs counter to current
restrictions on foreign equity or ownership of enterprises under the 1987
Constitution.

Without this limit to foreign capital, local commercial fishers and aquaculture
operators may be put at a serious disadvantage later on, especially because they
do not have the advantage in terms of technology and neither are they subsidized
like their Japanese counterparts. Japanese fisheries subsidies amount to more than
US$ 2 billion yearly, the largest in the world.

Besides, there are other disadvantageous terms in the agreement. Japanese

investors are not required to do the following: technology transfer, hiring of
locals or local sourcing of raw materials (Article 93). The same article says no
restrictions may be imposed in the sale of goods and services coming from Japanese
investments.

Philippine negotiators have argued that we do not have any defensive interests in
agriculture and fisheries. But the above JPEPA provisions prove otherwise; they
pose a threat to both local capital and the sustainability of resources.

Protective barriers against local fishery products

Moreover, Japan remains protective of many fishery products that are caught by
municipal fishers. Products like sardines, mackerel, anchovies, cuttlefish and
seaweed are excluded in the JPEPA schedule of tariff reductions for Japan. In
excluding these products from any commitments to tariff elimination, Japan has the
option not to reduce and even increase the tariffs on these products, depending on
its interests.

Why did Filipino negotiators fail to have these products included in the Japanese
schedule of tariff reduction if in fact what we have is offensive interest in
fisheries vis-�-vis Japan? Even before JPEPA was concluded last year, the Japanese
tariff for local yellow-fin tuna was already low at 3.5 percent; and the tariff
for frozen shrimp was already zero percent. What our negotiators should have
worked on was to get more market access for other local fishery products in Japan;
which they had failed to do.

Trade in endangered species

There is a need to further study the implication of the inclusion of manatee,

dugongs, whales and dolphins in both the Philippine and Japanese schedules of
tariff elimination of products. In fact, the Philippines has agreed to immediate
elimination of tariffs for these marine mammals upon entry into force of the
agreement.

These species may not be traded by the Philippines and Japan which are both
signatories to the Convention on International Trade in Endangered Species
(CITES). Japan, however, continues to fish commercially for certain endangered
whale species (e.g. minke and Bryde whales) and to engage in annual hunts for
dolphins and porpoises-saying that whaling and dolphin hunts (justified as a means
to control dolphin populations) are part of Japanese culture.

The Philippine inclusion of these endangered species in its tariff elimination

schedule cannot be simply dismissed as a technical matter. It implies that the
country also regards these species as tradable, despite the prohibition under
CITES and the Philippine Wildlife Resources Conservation and Protection Act
(Republic Act 9147).

Related: http://www.tambuyog.org

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Comments

31 May 2007
by ggg

NO GATS FRIENDS: JPEPA????????????????? kongyeesaimau.blog32.fc2.com/blog-entry-

96.html

?�???????????(JPEPA)?? www.geocities.co.jp/SweetHome-Ivory/9660/jpepa/index.html

2006 ? 11 ? 29 ? ?????????????????????????????????? www.geocities.co.jp/SweetHome-

Ivory/9660/jpepa/20061129_jpepa_press.pdf

??????(EPA)??????????? www.ne.jp/asahi/kagaku/pico/basel/JPEA/jpepa.html

further info on FTAs: bilaterals.org

02 Jun 2007
by Jim Santos

The provisions in JPEPA that would allow Japanese fishing fleets to fish for tuna,
sharks, whale, all other marine fishes and crustaceans without any restriction or
quota on quantity of catch, plus national treatment (equal treatment as Filipino
fishermen) for Japanese fishermen fishing in Philippine waters and EEZ�s (200 mile
exclusive economic zone) can be found in Article 28 & 29, Chapter 3 of JPEPA. It
also allow deployment of factory ships in Philippine waters. Certainly, on this
aspect alone, it is a one-sided agreement. Who is in his right mind would think
that Philippine domestic fishing fleets (mostly second hands) could access Japan�s
territorial waters to fish for tuna or other marine fishes?

07 Jun 2007
by Luis

Articles 28 and 29 refer to rules on the origin of goods, such as fish originating
from the ships of one party, which may be caught in territories outside of one
party. But these provisions say nothing about fishing in the territorial waters of
the other party.
�

04 Jul 2007
by Jim Santos

JPEPA including its Annexes consists of more than 900 pages - a complex agreement
with so many references on other international trade agreements (GATT, WTO, etc).
To understand the implications of Art 28 & 29 on rules of origin, it shall be read
in conjunction with Art. 2 mentioned in above write up. To elucidate, Art. 2
provides that JPEPA�s coverage extends to territorial waters including EEZs of the
parties (Phils and Japan) and that both parties is given access to it. Under Art.
28 & 29, it provides that fishing vessels/factory ships of either party can
extract/catch any marine and submarine resources found within the territory of the
other party with the extracting/catching party given national treatment or "as if
it is their own territory".

With pronounced shortage of tuna in Japan due to overfishing which brought panic
and increasing prices, is it not the best oppurtunity for Japanese commercial
fishing to pre-position themselves in Phils and benefit from it (instead of other
countries)?

source: Japan Indymedia

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Comment on this article

Forum
> Fishy issues in Japan-Philippine Economic Partnership Agreement (JPEPA)
20 October 2007, by mylene
the the Fishly issues in Japan Phil. Economic Partnership Agreement is simply an
advantage only on the part of Japan. if the phil. will allow it, what will happen
to our own fish supply? Surely the sustainability of the fish supply in the Phil.
for our own consumption is greatly compromised.

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http://cache.search.yahoo.net/search/cache?ei=UTF-
8&p=what+is+jpepa+treaty&y=Search&rd=r1&meta=vc%3Dph&fr=yfp-t-305-
s&fp_ip=PH&rs=0&u=www.no-
burn.org/wna07/wna2007.presentations/WNA07.Keynote.JPEPA.pdf&w=jpepa+treaty+treati
es&d=eKRwzRg5RME6&icp=1&.intl=us

A. What is JPEPA?- A bilateral free trade agreement.

- �Mega-treaty� covers a wide area, e.g. investments, government procurement,
intellectual property, commodities, etc. - Likened to North America�s NAFTA (North
American Free Trade Agreement) and other Free Trade Agreement (FTA)A. What is
JPEPA?Objectives of JPEPA:Liberalize and facilitate trade in goods and services
between the Parties;
Establish a framework for further bilateral cooperation and improvement of
business environment;
Create effective procedures for the implementation and operation of this Agreement
and for the resolution of disputes.
Etc.A. What is JPEPA?Tools used to reach JPEPA objectives:
1. Tariff Elimination;
2. Eliminate non-tariff controls;
3. Preferential treatment;
4. Ease of entry of goods/services/investments- Paperless Trading
- Certification of IndustriesA. What is JPEPA?How will it benefit the Philippines?
- Access to Japanese labor market by Filipino workers- Preferred treatment over
agricultural products- Projected gain by the Philippines �$9 billion A. What is
JPEPA?How will it benefit Japan?
- Ease of access/Preferential treatment of Japanese goods to Philippine
market.A. What is JPEPA?What commodities are covered?
- Corn, sugar, other agricultural products, incinerators, etc.- Including the
following wastes:Ash and residue from the incineration of
municipal waste;A. What is JPEPA?Waste pharmaceuticals;
Municipal waste;
Sewage sludge;
Clinical waste;
Lead, cadmium waste and scrap;
Waste oils containing PCBs, PBTs, and PBB;
Lead-acid batteries, etc.B. Concerns Over JPEPAJPEPA = Mushroom1. Grows well in
the dark;
2. You need to throw BS/Untruths on it to grow;3. Grows outward to the immediate
area around it.B. Concerns Over JPEPA1. Kept in the dark
-2 years of negotiations without any civil society consultation.-Civil society
members filed a case in Supreme Court Dec. 2005 to be given access to text of
treaty. -Text only became available after treaty was signed by Phil and Japan in
Helsinki, Finland in Sept. 9,2006.B. Concerns Over JPEPA2. Untruths used by Phil.
government to sell JPEPA to the public:-�There are sufficient safeguards under
Phil. Law and Basel Convention.�-�The provisions on toxic wastes do not mean
anything.�-�Japan won�t send their toxic waste to us.�B. Concerns Over JPEPA2.
Untruths used by government to sell JPEPA to the public (cont.):-�Based on WTO
rules, all products that
are subject to tariffs must face reduced
duties, including �waste��Japan Phil.Di
sposal
Costs--Increase global toxic waste Increase global toxic waste
generation.generation.--Widening gap between the Widening gap between the rich and
poor.rich and poor.OECD/EU OECD/EU countriescountriesand and the the Basel Basel
BanBanIgnoringIgnoringSloveniaCyprusNorwayMexicoSlovak
RepublicBelgiumHungaryLithuaniaMaltaNetherlandsLuxembourgLiechtensteinLatviaItalyI
relandIcelandGreeceJapanGermanyUnited StatesUnited
KingdomFranceUnderminingUnderminingTurkeyFinlandSouth KoreaSwitzerlandEstoniaNe w
ZealandSwedenDenmarkCanadaSpainCzech
RepublicAustraliaPortugalAustriaRespectingRespectingPolandRatified & Implementing
Ratified & Implementing Japanese waste keeps on coming�.Japan e-waste found in
Taizhou, China 2004 Japanese scrap computers photographed
by BAN in Lagos, Nigeria, Africa in
October 2005. Significant quantities of
hazardous electronic waste from Japan
are exported all over the world without
testing to assure whether material is
waste or not. In Lagos, 75% of this
material is simply dumped and burned in
informal wayside dumps . Copyright �
Basel Action Network. 2005.1. Conflict with Basel Convention- Re-defining Wastes
vs Goods
- Elimination of Controls
- Facilitating Transfer of Pollution from Japan to Poorer Countries, such as
Philippines2. Precedent Setting
3. Undermine other Multilateral Env. AgreementsB. Concerns Over JPEPASpreading to
other countriesSingapore, Oct. 31, 2002
Malaysia, Dec. 15, 2005
Thailand � Under Negotiation
Indonesia � Under Negotiation
India � Proposal/Negotiation
China � Proposal/NegotiationBrunei � Under NegotiationB. Concerns Over
JPEPAConflict with other MEAs:Stockholm/POPs � PCBs, DDT, etc.
Montreal Protocol � CFCs, brominated chemicals
CITES � ivory, tortoise shell,
whalebone, etc.B. Concerns Over JPEPA1. Philippines must reject JPEPA.
2. Japan, Philippines, and other Asian nations must immediately ratify the Basel
Ban
Amendment3. Full impartial multi-stakeholder inquiry to conducted to determine how
toxic waste
provisions got into JPEPA.4. Regional coordinated action by civil society is
needed!C. Recommendations1988Farmer - Sunday Nana
Income - $100/month
Lessee � Italian Firm
Goods - Fertilizer
Fertilizer � Toxic Waste
Environmental Scandal
Koko Beach, Nigeria2006Gloria Macapagal-Arroyo9.1 Billion Pesos -TradeJunichiro
Koizumi
Various Commodities
Goods = Wastes
Environment, economic, labor, human rights scandal?JPEPAWhy should Asia bear the
toxic burden Why should Asia bear the toxic burden of Japan?of
Japan?www.ban.orgbanasel
ction
etwork

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http://www.manilatimes.net/national/2007/nov/05/yehey/top_stories/20071105top5.htm
l

Chamber asks Senate to ratify JPEPA

The Japan-Philippines Economic Partnership Agreement (JPEPA) got a boost Sunday

when the Philippine Chamber of Commerce and Industry asked the Senate to ratify
it.

The chamber, which has 98 chapters and 30,000 members nationwide, passed a
resolution at the conclusion of the 33rd Philippine Business Conference held in
Manila last week asking the Senate to approve the pact.

In a statement released Sunday, chamber Chairman Donald Dee said, �With the
overwhelming support of businessmen from all over the country for the economic
treaty, we hope the senators would take into account their views when they vote on
the ratification when they reconvene next month.� Dee is also the country�s
special envoy on trade negotiation.

For his part, Sen. Richard Gordon also made public his support for the JPEPA as he
underscored the prospect in investments and opportunities that the treaty will
provide for the country.

Gordon cited the importance of a bilateral agreement in helping the country move
forward toward attaining progress and growth.

But Gordon also called for some amendments in the treaty so that it will serve the
best interests of the Filipino people.

Earlier, during the Kapihan sa Senado, Sen. Edgardo Angara also voiced his support
for the JPEPA, saying that what is important is for us to approve the treaty now
and discuss about possible refinements later.

Legal experts from the government have assured the public that there is nothing in
the treaty that would violate provisions of the Constitution and existing
Philippine laws.

They said the treaty also does not prevent the Congress from exercising its
plenary legislative power to pass laws that would run counter to any provisions of
the JPEPA.

Members of the Philippines Senate are expected to take a vote when it reconvenes
next month. An affirmative vote by 16 senators is needed for the treaty to be
enforced.

Practically every business organization with head offices in Metro Manila have
concluded that the country would stand to lose the golden opportunity for growth
if the Senate rejects the treaty.

They projected that with similar treaties already forged between Japan and the
country�s main competitors in Southeast Asia, a rejection would penalize
Philippine exports to Japan because they would be slapped with higher import
duties unlike similar goods from Malaysia, Indonesia and Thailand that will enjoy
zero or near-zero import duties.

The chamber of commerce, along with the major business groups in the country, had
signed a joint resolution asking the Senate to ratify the agreement.

Aside from Dee, those who signed the joint resolution were Samie Lim, president of
the Philippine Chamber of Commerce and Industry; Sergio R. Ortiz-Luis Jr.,
president of Philippine Exporters Confederation; the lawyer Miguel B. Varela,
chairman of Employers Confederation of the Philippines; Ambassador Albert F. del
Rosario, president of Management Association of the Philippines; Ambassador
Francis Chua, president emeritus of Chamber of Commerce of the Philippines
Foundation; Alberto A. Lim, executive director of the Makati Business Club; Jesus
Arranza, president of the Federation of Philippine Industries; and Elizabeth H.
Lee, president of the Chamber of Automotive Manufacturers of the Philippines, Inc.

Among the sectoral groups that have endorsed the JPEPA were the Union of Local
Authorities of the Philippines, Liga ng mga Barangay, Trade Union Congress of the
Philippines, Port Users Confederation, Chamber of Furniture Industries of the
Philippines, Philippine Food Producers and Exporters Association, Philippine Mango
Exporters Foundation and Philippine Okra Producers and Exporters.

~~~~~~~~~~~~~Arroyo: RP to stay �cautious, vigilant� amid economic boom

January 29, 2008 08:27:00
Maila Ager
INQUIRER.net

MANILA, Philippines � (UPDATE) Despite the country's economic progress, President

Gloria Macapagal-Arroyo said her government would remain "cautious" and "vigilant"
amid the current international economic uncertainty.

"It's clear that everyone who knows our country agrees that we are in a better
position today than ever to withstand and be resilient when confronted with
international economic uncertainty," Arroyo said in her speech on Tuesday after
arriving from Switzerland and the United Arab Emirates.

But while she expressed confidence and optimism about the long-term progress of
the Philippine economy, the President said, "We're also cautious about the current
state of the world economy."

"As such, we assured everyone we met abroad and we say to our people here at home,
we are not complacent. We remain vigilant in pursuing economic reforms and
maintaining our fiscal discipline just as we're working hard at home to mitigate
the impact of any economic slowdown on our people," she said.

In her visit to the UAE, Arroyo announced certain measures such as a new deposit
instrument of the Bangko Sentral ng Pilipinas (Central Bank of the Philippines),
that would ease the impact of fluctuations in currency rates on the remittances of
overseas Filipino workers.

She also cited the newly launched Landbank card for OFWs that would reduce their
expenses in remittances to the Philippines.

As a result of her UAE visit, Arroyo said there would also be new investments
coming to the Philippines starting this year.

Among the benefits of her trip to Europe, where she attended the World Economic
Forum in Switzerland, and in UAE are new trade and investment opportunities,
strengthened relations with multilateral agencies and donor agencies who support
the country�s development program, better working conditions for OFWs, and
increased levels of cooperation with countries around the world.

"It's clear that the world is taking notice of the success our country has
achieved in turning our economy around and in generating some of the highest
economic growth levels in a generation," she said.

"It's because of that international recognition that a number of current foreign

investors told us of their plan to expand their operations in the Philippines and
new investors confirmed their intentions to establish operations here," she said.

Copyright 2008 INQUIRER.net and content partners. All rights reserved. This
material may not be published, broadcast, rewritten or redistributed.

~~~~~~~~~Arroyo sees GDP growth continuing at around 7%

January 25, 2008 18:05:00
Joel Guinto
INQUIRER.net

DAVOS, Switzerland (via PLDT) -- President Gloria Macapagal-Arroyo said the

economy will continue to grow "in the neighborhood of 7.0 percent," and the budget
could be balanced at the end of 2007.

"[Growth] will be in the neighborhood of 7.0 percent because for the three
quarters, we were at 7.1 percent, and that is way beyond the projections of the
international financial institutions," she said in an interview on "Davos Today,"
which was aired Friday on local television.

The President, who is in this ski resort town for the World Economic Forum (WEF),
did not specify if her growth projection was for the fourth quarter, or the full
year of 2007.

When asked about the deficit problem, Arroyo said that with the tax reforms she
initiated, her economic managers have recommended that the target to balance the
budget be moved to 2008 from 2010.

"Well, my economic managers might surprise even themselves, that we might have a
balanced budget in 2007. But in any case, the market wasn't expecting that, so if
it comes, then it's going to be a windfall," she said.

Arroyo said fears of a looming recession in the United States, which have caused
world markets to tumble, have made this year's WEF meeting more significant, "more
important."

"With the events in the world happening this week, all the more, Davos became
important because of the uncertainties that have unfolded this past week. It is
all the more important for the world leaders in business and government to get
together and collaborate more closely," she said.

She also expressed confidence that the Philippine economy will withstand the
slowdown in the US.

"The good news is that the Philippines, because of our reforms, has achieved a
level of maturity and stability that can help us withstand, that makes us more
resilient than at any point in time in our history, to be able to withstand
external shock," she said.

Copyright 2008 INQUIRER.net and content partners. All rights reserved. This
material may not be published, broadcast, rewritten or redistributed.

~~~~~~~~~~Worried Arroyo calls Palace to ask how RP stocks faring

January 24, 2008 03:17:00
Michael Lim Ubac
Philippine Daily Inquirer

MANILA, Philippines -- With global financial markets roiled by fears of the US

economy slipping into a recession, a worried President Gloria Macapagal-Arroyo
Wednesday phoned Executive Secretary Eduardo Ermita from Switzerland to ask about
how the local bourse was faring.

The President, who is attending the annual meeting of the World Economic Forum in
the ski resort of Davos, which started Wednesday, made the call even after
Malaca�ang said the country �will weather any storm.�

Press Secretary Ignacio Bunye said the country would likely withstand the adverse
effect of a US slowdown largely because of its improving economic fundamentals.
Bunye noted that from a high of 28 percent seven years ago, Philippine exports to
the United States dropped to less than 20 percent of total export income as
exporters had diversified their markets.

�We remain vigilant and we know that the Bangko Sentral ng Pilipinas is closely
watching developments on the monetary front and that gives us great comfort that
we can and will weather any storm,� he said.

Ms Arroyo called up Ermita in the middle of his press conference in Malaca�ang,

which was telecast live by government TV and radio stations, to ask about the
stock market and other economic indicators.

Arroyo focused

The executive secretary then excused himself, disappeared briefly then went back
to the Palace media briefing room and resumed his weekly press conference.

�You can see how focused the President is. She is (in a faraway land), yet she
called up to ask about us,� Ermita said.

�How are you? It�s cold here. What is the effect of the announcement in media
about the American drop in the stock market?� Ms Arroyo was quoted by Ermita as
saying.

He said he told Ms Arroyo that it was the burning issue of the day.

Specific figures

Ms Arroyo then asked Ermita to get �specific figures from� the Department of
Finance and the National Economic and Development Authority.

Ermita said Ms Arroyo�s order was for Cabinet officials �to focus our attention�
on all the projects in the pipeline.

�If other countries such as the European Union could very well be affected by this
economic slowdown, you see how it is for a developing country such as the
Philippines,� he said.

Ermita said the government would focus its attention on implementing

infrastructure projects and hastening their completion so people could benefit
from them.

�That will help cushion the impact of this slowdown of the economy of the United
States,� he said.

When Ms Arroyo and her party left Tuesday for a seven-day trip to Switzerland and
the Middle East, she ordered the Cabinet to speed up the implementation of all
projects in the pipeline to mitigate the adverse impact of a weakening US economy
on the Philippines.

2 external threats

At the Cabinet meeting she attended before leaving for Davos, Ms Arroyo
acknowledged that rising oil prices and the weakening US economy were two external
threats to the country�s economy.

Ermita said the Arroyo administration was seeking to improve relations with other
countries �so the Philippines does not become too dependent on one country.
As Ms Arroyo is away, Ermita is tasked with presiding over an emergency meeting of
the administration�s economic managers to discuss whether to adjust growth targets
and the goal to achieve a balanced budget this year.

Ermita said Malaca�ang was in the process of ascertaining the ill effects of the
US economic slowdown.

Copyright 2008 INQUIRER.net and content partners. All rights reserved. This
material may not be published, broadcast, rewritten or redistributed.

~~~~~~~~~~~~~~~~~~~Arroyo: Our economy is booming

January 24, 2008 02:45:00
TJ Burgonio Joel Guinto
Philippine Daily Inquirer INQUIRER.net Agence France-Presse

ZURICH, SWITZERLAND -- With its strong �economic fundamentals,� the Philippines

would weather a world financial crunch, President Gloria Macapagal-Arroyo said
Wednesday.

The President aired this positive outlook in a speech before the Swiss-Asian
Chamber of Commerce (SACC) here even as she made a pitch that the country remained
a favorable investment destination amid the global uncertainties.

�Our economy is booming,� she told leaders of the SACC at the Savoy Hotel. �But
like so many places in rich and poor nations alike, we must fight to close the gap
in income inequality.�

SACC is a nonprofit organization established to promote economic and business

relations between Switzerland, Southeast Asia and Korea based on the principle of
reciprocal benefit.

Ms Arroyo made the speech on the same day that the World Economic Forum in the
Swiss ski resort of Davos opened.

As the 38th World Economic Forum opened, the global economy was faced with huge
slides in stock markets, slowing growth, the subprime crisis and increasing oil,
food and other commodity prices.

�I don�t know whether there will be a recession in the United States, but I do
know that one year ago, at this time, things were very rosy,� Rahul Bajaj, chair
of Indian industrial group Bajaj Auto told Agence France Presse in Davos.

Credits BSP

Ms Arroyo, who led an 86-member delegation and who is set to attend the forum on
Friday, credited the Bangko Sentral ng Pilipinas for making the economy �more
resilient to external volatility.�

�In the midst of world uncertainties, it helps that we have one of the best and
most awarded central banks in the world, which has helped the Philippines achieve
a stable macroeconomic environment that is making us much more resilient to
external volatility,� she said.

Not dependent on US market

She said that a looming recession in the United States will not derail the growth
of the Philippine economy.

She said: �We are vigilant that our efforts should not be derailed by the subprime
crisis and the subsequent credit crunch in the US.�

Ms Arroyo said the government was counting on Bangko Sentral ng Pilipinas Governor
Amando Tetangco Jr. and his team to continue to �ensure macroeconomic
fundamentals� to support the country�s robust economic growth at a time of
continuous global economic volatility.
She later said in a forum that the Philippines was a �free enterprise economy� and
that government would not meddle with the central bank in determining the foreign
exchange rate.

Finance Secretary Margarito Teves earlier said that the Philippines could
withstand the adverse effects of a US economic slowdown or recession because of
its �improving economic fundamentals.�

In an interview with reporters, Trade Secretary Peter Favila said the country
should not worry about the slowdown of the US economy.

�Even in the Asia-Pacific region, many of the economies are not necessarily
dependent on the US market. Our export market to the US has gone down, but our
economy is growing. So by and large, it�s a globalized economy,� Favila told
reporters.

�You�re no longer indexed to just one market economy,� he said.

Investment haven

In her speech, Ms Arroyo said the Philippines was �on the path to permanent
economic growth and stability,� and hence, remains a favorable investment haven.

�We have created seven million jobs in seven years. We have achieved 28
consecutive quarters of economic growth even when many of our neighbors
experienced negative growth or even recession at some time or another of the last
seven years,� Ms Arroyo said.
�In fact our economy, which rose 7.1 percent in the first three quarters of 2007,
is experiencing its fastest growth in more than one decade,� she said.

Faster growth

Ms Arroyo noted that the Philippines grew �faster� than the rest of Southeast
Asia, despite oil price volatility and a global economic slowdown.

�Our international reserves are also at record levels. We have a balance of

payment surplus, a low inflation rate and low interest rates,� she said.

�Business and investor confidence is on the rise. The peso is one of the world�s
best performing currencies, and our stock market has reached historic heights. Our
budget is under control, and we are raising unprecedented amounts of revenue,� she
said.

Ms Arroyo said that the strong peso had helped mitigate the impact of the
escalating prices of crude oil, averting an increase in public transport fare.

�We�ve not had an increase in public transportation fare. That would have started
a spiral of inflation � Our strong peso makes up for the high price of oil in the
world market,� she later said in an open forum.
Hedge facilities for OFWs

Ms Arroyo announced that she was setting up �hedge facilities� for overseas
Filipino workers in Dubai to keep them insulated from an unstable peso-dollar
exchange rate.

She said she has ordered the labor department to review new contracts of OFWs to
include payment in the currency of higher value.

�I�ve instructed the Department of Labor and Employment to review the contracts
between foreign employers and Filipino workers so that contracts will now
stipulate that they will be paid in pesos or dollars, whichever is stronger,� she
said.

Arroyo said the dollars remitted by the OFWs not only prop up the economy, but
also help build a new labor base by sending their children to school.

"We value the contribution of our OFWs for creating our manpower pool," she said.

"But I do dream of and work for the day when we can keep our best and brightest at
home, and overseas work is just another career option and not the only choice left
for a hard-working Filipino," she said.

Ms Arroyo said that in the face of the volatility in world markets, the
Philippines, thanks to its sound economic fundamentals, was offering itself as a
�strategic location� for business opportunities.

�We have met the challenge of economic and fiscal reform,� she said.

Highly trained manpower

She said that investment in the Philippines had grown more than five-fold from
2003 to 2007, thanks to the billion-dollar investments by major international
companies, including Texas Instruments.

Ms Arroyo added that the country ranked among the most attractive off-shoring
destinations in the world because of �cost-competitiveness� and highly-trained,
English-speaking IT-adept manpower.

�Our outsourcing sector has the potential to grow 40 percent per year from 2007
until 2010,� she said. With a report from Agence France-Presse

Copyright 2008 INQUIRER.net and content partners. All rights reserved. This
material may not be published, broadcast, rewritten or redistributed.

~~~~~~~~~~~~~~~~~~~~~Philippines moves down in global IT ranking--WEF

March 28, 2006 18:07:00
Agence France-Presse INQ7.net

(UPDATE) THE PHILIPPINES has moved down in a 2005 World Economic Forum (WEF)
report that ranks countries in terms of their information technology
infrastructure and policies.

From a ranking of 67 in the 2004 edition of the report, the Philippines now ranks
70. In 2003, the Philippines ranked 69.
The ranking released by the WEF on Tuesday also said that the United States has
taken over from Singapore as the top country for the development of information
and communications technology.

The Global Information Technology report 2005 praised the "impressive performance"
of the technical infrastructure in the United States, as well as the business
environment.

It also highlighted US openness to technological innovation, helped by the higher

education system and the ready availability of venture capital.

Singapore secured second place in the "Networked Readiness Index" thanks to its
regulatory environment, and "world class" education and training.

The index of 115 economies is based on a survey of business executives.

"Information and communication technologies presently represent one of the most

important drivers in boosting efficiency and productivity in today's fast changing
global economy," Augusto Lopez-Claros, co-editor of the report.

Asian countries generally faltered in the table. Hong Kong, Australia and Japan
ranked between 11th and 16th after falling several places.

China fell nine places to 50th position, losing touch with India (40th).

By contrast, South Korea (14th) gained ten places.

Leading Asian nation Taiwan (seventh) -- "an ICT powerhouse in the last three
decades," according to the report -- gained eight places over 2004 thanks to
"intelligent" public policies and public-private partnerships in the sector.

Nordic countries again dominated the top of the ranking, with Denmark, Iceland and
Finland in third to fifth places, and Sweden ranked number eight.

The report said the reasons for the Nordic technological strength mirrored those
behind their strong performance in overall economic competitiveness rankings:
"highly-developed" education, a strong culture of innovation and government
transparency that promoted a "friendly climate" for new business ventures.

"The Nordic countries have been for many years ICT powerhouses, managing to
harness the latest technologies to enhance the efficiency of their economies and
to boost living standards," Lopez-Claros said.

Neighboring Estonia led eastern European countries in 23rd position thanks to its
"excellent political and regulatory framework."

Russia (72nd) fell 10 places in the ranking, reflecting concern about a

deteriorating institutional environment, notably on property rights and the
independence of the judicial system, the WEF said.

With a report from Agence France-Presse in Geneva

Copyright 2008 INQUIRER.net and content partners. All rights reserved. This
material may not be published, broadcast, rewritten or redistributed.

~~~~~~~~~~~~~~~~~~Stocks tumble, peso slides to 16-month low

By Elizabeth Sanchez-Lacson, Doris Dumlao

Philippine Daily Inquirer
First Posted 01:49:00 09/17/2008

Most Read Other Most Read Stories x

Business
Stocks tumble, peso slides to 16-month low
BSP gives assurance as 2 banks take hit from Lehman
Oil in steepest two-day slide since 2004
Economists see further peso slide
Wall St ends higher on hopes of AIG resolution
P7-B port city being planned in Aurora
RP braces for effects of AIG, Lehman troubles on economy
Hurricane Ike topples several US oil platforms
Oil prices dip below $92/barrel in Asia
The news gets worse
Banco de Oro sets P3.8B for Lehman exposure
Peso falls to 16-month low of 47.295 to dollar
Business Most Read RSS
Close this The collapse of Lehman Brothers, one of Wall Street�s oldest investment
banks, Tuesday sent Philippine stocks plummeting 4.5 percent to a new low in a
year and a half.

The peso also slid to a 16-month low at 47.20 to the dollar as the fragile health
of iconic US financial giants heightened global investors� aversion to currencies,
bonds and stocks from emerging markets like the Philippines.

The Philippine Stock Exchange index (PSEi) lost 114.44 points to end at 2421.72.

�Generally, this is sentiment spilling over from the severity of the impact of
Lehman�s bankruptcy on the US financial sector. The outlook still remains
uncertain,� said Ron Rodrigo, head of research at DBP Daiwa Securities.

Tuesday�s close was the lowest for the PSEi since July 23, 2008, when it finished
at 2462.94. The market�s fall was also the biggest point decline since March 10,
2008, when it dropped 119.85.

Total foreign selling on the stock market amounted to P1.73 billion, compared with
total foreign buying of P747.83 million.

Lehman�s collapse �has heightened risk aversion� among foreign investors in the
Philippine stock market, said Paul Joseph Garcia, chief investment officer at ING
Investment Management Philippines. �Since the subprime crisis started in August
2007, foreign funds have sold over $1 billion in the stock market. We think that�s
around 70 percent of foreign funds that came in prior to the subprime crisis. So
we feel that foreign selling pressure will continue and then fizzle to a more
manageable degree.�

Since Monday�s news of Lehman�s possible collapse, the PSEi has lost 224.4 points,
or 8.4 percent.

However, analysts said Philippine corporations should not be severely affected by

the US subprime crisis.

�Banks here are not overleveraged [dependent on debt] like US banks. In fact,
banks here have too much cash. But [stock market] sentiment will definitely be
affected,� April Tan, head of research at CitisecOnline.com, said.
Emotions got the better of investors Tuesday as they sold heavily the stocks of
banks that disclosed direct exposure to Lehman Brothers. The financial index
showed the biggest loss at 8.41 percent, or 55.3 points, to 602.08.

Banco De Oro Unibank Inc. was the market�s third-biggest loser as it slumped 15.38
percent or P6 to close at P33 a share.

The peso tumbled to 47.30 to the dollar before closing at 47.20 as investors
pulled money out of risky investments in emerging markets to seek safer havens,
particularly cash and US Treasury securities.

Banco de Oro Unibank chief strategist Jonathan Ravelas said the next key barrier
to the dollar�s climb against the peso would be 48.00 to the greenback.

The peso is at its weakest level since hitting 47.36 to the dollar on May 11 last
year. It has depreciated 12.5 percent since the start of the year, making it among
the worst-performing currencies in Asia this year. With editing by INQUIRER.net
~~~~~~~~~~~~~~