Indonesia accuses RP of violating spirit of WTO

Indonesia has accused the Philippines of violating the spirit of the World Trade Organization (WTO) agreement.

In a letter to the Tariff Commission, Indonesian director of trade defense Bachrul Chairi said the Philippines is clinging to a law that is "not in full compliance with the spirit of the WTO.

Seeking a meeting with Philippine representatives, Chairi said the Indonesian government "considers this commitment to the WTO agreement to be of particular importance in that the Republic Act (RA) 8800 is not in full compliance with the WTO agreement."

RA 8800 is also known as the Safeguard Measures Act.

Chairi said the Philippines had made commitments regarding complaints towards the proper adoption of safety measures under the act on their ceramic tiles

"Our government strongly opposes the application of safeguard measures which are unwarranted," the Indonesian director said. "The preliminary determination in the report fails to address all pertinent issues of facts and law, as laid down in article 3.1 of the agreement."

The Indonesian director claims that the Philippines has been using several excuses to block the entry of Indonesian ceramic tiles. Some of these alleged "excuses" are over-capacity, high interest expenses on the performance of domestic industry, and restructuring plans.

Chairi described the safeguard measures as a "discriminatory," adding that "there is no legal basis of de inimus imports as they are developed economics as stated by the WTO agreement."

"If it is the intention of the Philippines to single out Indonesian exports as having increased in disproportionate terms, we would remind the Tariff Commission of Article 5, paragraph 3 of the agreement," the communication stated. "The manner in which the quota is calculated is also unacceptable as article 2 of the agreement requires a representative period to be established.

It added: "Furthermore, our government also requested an explanation as to why imports of Mariwasa are excluded from total import."

Meanwhile, the ASEAN Washington Committee (AWC) wrote the US Senate Finance Committee expressing its concern over moves by the US Congress to grant duty-free benefits to canned tuna imported from the Andean countries.

In an open letter to the US Senate, the AWC said canned tuna imports from the Andean countries particularly Ecuador have increased dramatically in the past four years.

"The Andean countries already have competitive advantage over Asean on transportation cost. Statistics also implies that Andean countries do not need the duty-free treatment to compete in the US market," it said.

The Andean Trade Preference Act expired on Dec. 4 last year but the US government extended it for 90 days, or from Feb. 15 to May 16 this year. In November last year, the US House of Representatives passed the Andean Trade Promotion and Drug Eradication Act granting the duty-free treatment to all imported canned tuna from the Andean countries.

The report also questioned the US Senate Finance Committee for granting duty-free benefits to imported canned tuna from the said countries even if it limits the quantity to 20 percent of the US domestic canned tuna production last year.

The AWC claims that the extension of trade benefits to the Andean countries was made in recognition to these countries efforts to fight the drug menace.