RCEP: Threat to the Philippine economy, people, and environment

By APRN | February 21, 2023

We saw the detrimental effect of the Rice Tariffication Law after the Philippine government fully complied with the World Trade Organization (WTO) rules in removing barriers by lifting quantitative rice imports restriction. This resulted in reduced income for Filipino rice farmers due to competition with imported rice products and cheap farmgate prices. Now, the country is facing onion price shocks after years and decades of prioritizing the importation of agricultural products over developing the domestic agricultural sector.

The Asia Pacific Research Network (APRN) is deeply concerned about the potential negative implication of the Regional Comprehensive Economic Partnership (RCEP) on the Filipino people, economy, and environment if the Philippines shall integrate with this mega-trade deal.

RCEP is a regional free trade agreement among ASEAN members and five other major country-economies: China, Japan, South Korea, Australia, and New Zealand. It covers 30% of the world’s population and 30% of the global economy.

One of the main concerns is food insecurity may continue to persist, or even worsen. With the reduction of the remaining trade barriers, the country’s import dependency on agricultural products will only worsen, which could make the country more vulnerable to supply shocks and price fluctuations.

The agreement could also further escalate the land grabbing in the country. The RCEP contains “National Treatment” provisions, in which, the government may treat multinational corporations of other RCEP members as if they were domestic companies. This will allow foreign investors to acquire land without restriction and may lead to the displacement of our small farmers.   

RCEP could also lead to losses in livelihood in some sectors particularly in agriculture and manufacturing as cheaper imports from other countries flood the market and local producers struggle to compete with large corporations. Even the government-owned Philippine Institute for Development Studies (PIDS) said that the country’s free trade agreements did not boost jobs. 

In addition, this agreement also ignores the protection of workers’ rights, including the right to organize, collective bargaining, and fair wages, which will further depress the wages and aggravate the exploitative working conditions in the country. The Philippines is one of the ten worst countries for workers in 2022, according to the International Trade Union Confederation (ITUC).  

The agreement also includes Intellectual Property Rights (IPR) beyond the level of the WTO Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS). With these provisions and patents, big pharmaceutical companies will only continue their monopoly control over the production and distribution of drugs for certain periods, making it more difficult for Filipinos to access affordable generic medicines.

The RCEP also has lack provisions for environmental protection or climate change issues. According to a study, RCEP members would increase global carbon emissions from fuel combustion by about 3.1% due to an increase in production and tariff elimination. The agreement could also lead to land-use change and deforestation in the countryside in favor of transnational corporations, which could further exacerbate climate change. The Philippines categorize as most at risk from the climate crisis in a report published by Institute for Economics and Peace in 2019.

With utmost concern, APRN is urging the Philippine Government to listen to the people and reject the RCEP deal. The promise of development through the country’s economic integration in WTO Agreements during the 1990s did not materialize, hence, the country’s agriculture and manufacturing fell into the smallest share of GDP after almost three decades of enacting the said multilateral trade agreements. Now, Ferdinand Marcos Jr.’s administration is dancing to the same tune of trade liberalization through RCEP that might gravely affect future generations to come.

APRN, alongside the working people and people’s movement in the Philippines, stand against RCEP. We call on the Philippine Senate to reject this mega-trade deal and prioritize genuine development of the national economy, protecting people’s rights and well-being, and the environment.###

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