The ‘open skies’ issue in Clark: A question of fairness*

Wigberto E. Tañada, Lead Convenor

We, at the Fair Trade Alliance (FairTrade), welcome this initiative of the Philippine Chamber of Commerce and Industry (PCCI) to hold this forum on “Save our Skies or Open Skies: A View from Both Sides.” Yes, we do need more public discussion on an issue that has apparently generated acrimony and confusion, not unity and clarity of what is best for the national interest.

A few weeks ago, a columnist chided the Fair Trade Alliance for siding with the local aviation industry on the proposed wholesale opening of Clark to foreign carriers. By opposing an open skies policy in Clark, we have been taken to task for taking a stand that is allegedly anti-tourism and anti-OFW. We have been reproached and admonished for continuing to adhere to the ‘Filipino First’ policy, which they said had failed and was even anti-Filipino. These certainly are big sweeping accusations by those seeking an all-liberalization of our skies against those demanding a calibrated, measured and progressive opening.

Let me clarify why the Fair Trade Alliance has sided with the local aviation industry by citing here some of our fundamental beliefs as an Alliance:

First, we are not against economic liberalization per se. However, we are for an economic liberalization that is calibrated, measured, progressive and synchronized with our own development priorities and the capacities of our industrial and agricultural producers, many of whom are members of the Philippine Chamber of Commerce and Industry. We are accordingly for calibrated protection, for this is what our neighbors – Japan, South Korea and now China and Vietnam – have done and are continuing to do. The problem is that our economic technocrats, from the time of Marcos to the present, have a very limited concept of attaining economic growth – that is, opening up of the economy in an accelerated, one-sided and even lazy and reckless manner.

Thus, in the l980s and 1990s, we opened up our manufacturing in a wholesale manner in accordance with a World Bank timetable, making us one of the ten most open economies by l997, this according to the Bank of International Settlements of Switzerland. The result? Many of our industries producing textiles, tires, tiles, plastics, chemicals, auto parts and so on have been decimated by the unilateral trade liberalization, aggravated by a culture of smuggling in the country and the anti-Filipino attitudes of our own technocrats. We did the same in agriculture, from the mid-1990s to the present. The result? From a net agricultural exporter, the Philippines is now a net agricultural importer of almost everything — from rice and corn to onion and garlic, from fruits and vegetables to meat and milk. Thus, if a food crisis will break out in Australia, Thailand and Vietnam simultaneously, this country will go hungry, as many of our displaced Filipino farmers have already been experiencing.

And now, from unilateral industrial liberalization and unilateral agricultural liberalization, we want to open up unilaterally our skies, our aviation market, without any equal reciprocity. My God, what is happening to this country?

This brings me to the second fundamental belief of the Fair Trade Alliance – there should be a level playing field for Filipinos and foreigners alike. Why in heaven’s name should foreigners be treated like kings and Filipinos like beggars in their own country by their own government? Under Article 2, Section 19 of our Constitution, it is expressly provided that the State should provide a self-reliant and independent national economy effectively controlled by Filipinos. Does this have no meaning at all? Even one of our native songs call for kaunting pagtingin for Filipinos from their own government. But unfortunately all this has been rendered meaningless by the continuing colonial mentality of some of our policymakers. Thus, in the Clark’s open skies issue, we are shocked to hear outright proposals for the Philippines to unilaterally open up our skies and abandon the globally-accepted norm of aviation trade negotiation, which is bargaining bilaterally for equal or reciprocal flying rights. Moreover, some arrogant foreign carriers want to have more rights than the Filipino air carriers such as the privilege of operating even without any permit from the Civil Aviation Board (CAB) and the privilege of using Clark as a hub to fly to other destinations. The unfairness is most evident when Macau denied the application of Asian Spirit to fly from Clark to Macau and back, whereas Tiger Air of Singapore has been allowed to fly freely from Clark to Macau and Singapore. As the CEO of Cebu Pacific himself was quoted, ‘we might as well as register as foreign air carriers’. A unilateral aviation liberalization policy clearly contradicts the Constitutional mandate that ‘the State shall protect Filipino enterprises against unfair foreign competition and trade practices’ (Sec. 1, Article XII).

Thirdly, we believe, if this country has to progress and soar, we must get our act together as a nation. But what some of the Clark open skies proponents have done are to divide us and confuse society because of some of the issues being raised are highly exaggerated if not false. For example, those questioning the proposal have been labeled as rent-seekers, protectionist and supporters of a failed Filipino-First policy. And yet, as clear as the blue sky, our unilateral economic liberalization of the last three and a half decades is what has failed this country. They have also conveniently ignored the inconvenient fact – most of the big air carriers in Asia are supported by their respective governments and are even owned wholly or partly by these governments, for example, Singapore Air is majority-owned by Temasek, a government investment corporation, while Thai Air is 70 per cent owned by the Thai government. In the Philippines, the industry players are now all private and do not get any assistance from the government. So who is rent-seeking? Who is protectionist? And yes, who is the anti-Filipino? Have you heard about what happened in the recent RP-Korea air talks in Davao? How about the expanded air agreement with Canada which has been pending for almost two years.

Another argument being raised by the proponents is that the entry of the foreign carriers in Clark has been a boon to tourism. Yes, it has been a boon to Macau tourism, a boon to Singapore tourism, a boon to Kuala Lumpur tourism and a boon to other tourist destinations outside the Philippines. Please take a look at the list of those taking the foreign air carriers, many of them are middle-class Filipinos herded at the pick-up point at Mega Mall in Metro Manila. Of course, we are not against Filipinos traveling and taking advantage of cheaper plane rates. But please, let us not exaggerate too much by saying that the Clark arrangement is a big boon to Philippine tourism when the fact is many of the tourists are flying outward, not toward our fabled 7,100 isles.

However, we, at the Fair Trade Alliance, are open to a discussion on how the development of tourism and the calibrated liberalization of the aviation industry can and should be pursued. In fact, we are asking the government and even the Philippine air carriers – where is the national blueprint for the aviation industry and the related tourism industry and the ancillary industries? Where is the Road Map that will strengthen these industries and create more and better jobs for all?

For this, we need to sit down and do honest-to-goodness dialogue and consultation with one another. This is how things are done in the US aviation industry. In the RP-US Bilateral Air Talks, the US panel was composed of government and private sector representatives, which is also their practice in the WTO and other trade negotiations. And yet, here in the Philippines, not only is unilateralism in policy formulation being foisted on domestic producers and traders unfairly, the locals are also being excluded from any consultation, much less negotiation. This is why we are alarmed when some government factotums have even the temerity to propose the outright exclusion of the Philippine aviation industry representatives in the air negotiation panels. Why in heaven’s name why?

To summarize, we, at the Fair Trade Alliance, are not against any aviation liberalization program. But let us do it in a calibrated, measured, progressive and transparent manner. Let us be fair and just to our own Filipino investors and their workers by having a level playing field for all. Let us strategize the development of the aviation industry, tourism industry and other ancillary industries in the context of what is best for the country and the Filipino. It is about time, it is long overdue that we treat the Filipino with respect and dignity in his own country. We need to recover our future as a people!

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* Speech delivered at the forum on “Save our Skies or Open Skies: A View from Both Sides.” organized by the Philippine Chamber of Commerce and Industry (PCCI) at the Asian Institute of Management, July 5, 2007.

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  1. 1 Debate rages on RP’s open skies regime | Fair Open Skies

    […] For former senator and Fair Trade Alliance lead convenor Wigberto Tañada, the recent controversies hounding aviation policy for Subic and Clark airports signals the need for the government to revisit its position. “Let’s discuss it, argue over it, study it. Then let’s see what really should be done. But it … […]




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