Guingona bats for economic nationalism

In the views of Vice President Tito Guingona and former Sen. Wigberto Tañada, the Philippines can only break away from its decades-old failure to industrialize if it adopts a nationalist economic agenda.

The prominent nationalist leaders expressed the same sentiments in addressing participants to a national conference of the Fair Trade Alliance that drafted its own agenda for national survival.

Following up the Jan. 10 pronouncement by President Arroyo to freeze the unilateral lowering of import tariffs in the country, Tañada said, the President may have seen the light.

"The policy pronouncement comes relatively late in the day, late in the sense that 90 percent of our tariff rates are already under the zero to five percent tariff regime, late in the sense that many of our industries, including agriculture have already suffered reverses and losses.

Vice President Guingona, for his part, declared that free trade as practiced by the developed nations, has been far from fair.

"Tariffs of rich nations are not only higher for developing country exports. They also escalate with the level of processing. For example, in Japan and the European Union, tariffs for processed food are twice as high as those on products in the first stage in processing," he revealed.

The case in agriculture is worse, Guingona revealed. Developed countries continue to protect their farmers — not only through tariffs but also through export subsidies. Tariffs on farm imports like meat, sugar and dairy products are five times those of manufacturers. Tariffs on vegetables like sweet corn, okra and carrots range from 16 to 22 percent.

Instead of scrapping protection and subsidies granted to their farmers, the rich nations, Guingona added, have increased their subsidies at an average of $1 billion a day in 1999. The estimated costs or losses to the poor countries as a result of farm subsidies in rich nations is a whopping $19.8 billion today, according to the vice president.

Because they are poor, third world nations can not afford to subsidize their agricultural exports can not afford to fund marketing, cheap credit and even infrastructure.

Both leaders concluded that free trade has not been the panacea for growth and progress for developing nations including the Philippines, but an unfair system that favors only the rich. — Abe P. Belena, Philexport News and Features