RCEP ratification faces further delay

MANILA, Philippines — The Department of Trade and Industry (DTI) emphasized the negative implications of delaying the country’s participation in the Regional Comprehensive Economic Partnership (RCEP) agreement as president-elect Ferdinand “Bongbong” Marcos Jr. cited the need to review the trade agreement’s impact on the agriculture sector.

“We hope that the next administration will recognize that stopping RCEP will not do any good,” Trade Secretary Ramon Lopez said in a Viber message to reporters yesterday.

In a press briefing yesterday, Marcos expressed reservations  over the ratification of the mega trade deal as he cited the need to study how the RCEP would affect the country’s agriculture sector.

“I don’t  know if our agricultural sector is sufficiently robust to take on the competition that opening of the markets will cause. So let’s have a look at it again, make sure the agri sector will not be at a disadvantage,” Marcos said.

He said the country’s farm sector should be in a competitive position before the country enters another trade agreement.

While Lopez recognized the need to provide strong support for the agriculture and even other local production sectors through agriculture inputs, fertilizers, feeds, mechanization, training and financing to help improve productivity and competitiveness, he believes the country should not postpone its participation in the RCEP.

“We need to nurture our local production capacities, not delay RCEP,” he said.

RCEP creates the world’s largest free trade area, accounting for about 30 percent of the global gross domestic product.

“With due respect, we will assure president-elect Ferdinand Marcos Jr.  that RCEP is safe for the agriculture sector, mainly because no new sensitive agriculture products were included in RCEP,” Lopez said.

In addition, he said the RCEP would enable greater market access for the country’s agriculture products.

“If we delay ratification, we run the risk of even losing market share as other RCEP countries will surely grab our market share, due to their lower entry tariff rates,” he said.

Apart from losing market share, he said delaying or deciding not to ratify the RCEP would lead to a shift of some investments for the Philippines toward other RCEP participating countries that enjoy market concessions.

“This will affect our very good FDI (foreign direct investments) growth momentum and job generation goals after the pandemic,” he said.

Lopez said other countries that have ratified the RCEP are already conducting businesses among themselves.

“Each day we delay, there is a threat to missing trade and investment opportunities,” he said.

RCEP, which was ratified by President Duterte last September, still needs Senate concurrence before the country can deposit its instrument of ratification to the Association of Southeast Asian Nations Secretary General.

Lopez said the DTI is  willing to provide a paper on RCEP as part of a briefing to the incoming administration.

“We need to ratify RCEP to bring in more jobs, nurture local production for greater productivity and competitiveness resulting in bringing prosperity for all,” he said. – Edu Punay