FairTrade Today: Deepening and Widening Advocacy for Trade Justice and Balanced Development

For the past years FairTrade’s engagement with the government on the appropriate trade and economic policies that it should adopt vis-à-vis the confusing noodle bowl of trade liberalization and economic integration initiatives being placed on the Philippine trade table in the name of varied bilateral, regional and multilateral trade agreements. At the same time, it helped interpret and articulate for the general public the meaning of each of the intermeshing noodles of trade liberalization and their actual and likely social and economic impact on the life of every Filipino. For example, the Alliance played a highly visible role in analyzing the implications to the nation of the latest developments in the WTO talks (especially of the highly technical formula issue under the Non-Agricultural Market Access or NAMA and the little-known aspects of the General Agreement on Trade in Services or GATS), the new bilateral trade agreements (Japan-Philippines Economic Partnership Agreement and the Philippines-ASEAN Early Harvest Agreement) and the various liberalization programs being initiated in the ASEAN after the completion of the ASEAN Free Trade Agreement or AFTA such as the various Priority Integration Projects (PIPs) and the concept of the ASEAN Economic Community by 2015 (earlier target of completion: 2020).

Last 2006, a number of Alliance-inspired-and-supported trade bills (intellectual property rights, creation of the trade representative office, declare smuggling a heinous crime, etc.), in cooperation with other civil societies and progressive legislators, were the subject of numerous Congressional hearings and deliberations; the bill seeking to maximize Philippine availment of WTO flexibilities under the TRIPs(e.g., parallel importation of cheaper drugs and early workings on drugs whose patents are about to expire), has been approved by the Senate and is now awaiting final approval by the House of Representatives. In relation to the IPR flexibilities, the Alliance was able to gather a broad coalition of health workers, hospital and drug unions, consumers and other sectors dedicated to the campaign for the reduction of the exorbitant prices of drugs via the fuller use of these flexibilities. The alliance is named Ayos na Gamot sa Abot-Kayang Presyo or, roughly, Right Medicine at Affordable Price, and the second bill, to declare smuggling a heinous crime has been approved on third reading at the House of Representatives and is awaiting approval at the Senate.

Another significant achievement of the Alliance is the formation of the Philippine Employer-Labor Social Partnership, Inc., which seeks to avoid the traditional route social accord between labor and management has taken in the Philippines – rich rhetorics by the parties on industrial peace during the signing and no monitoring and follow-up afterwards. Through a series of workshops and brainstorming sessions organized by the Federation of Philippine Industry (FPI) and the FairTrade labor affiliates, a list of concrete measures on how to give life to the social accord was drawn. Eventually, FPI and the FairTrade labor affiliates came up with a clear and doable framework of partnership – a Social Partnership on Decent Work, Productivity and Competitiveness.

The RTC Valenzuela court ruling dismissing a filed case to declare null and void Republic Act 8800 and its Implementing Rules and Regulations for being unconstitutional is another important achievement of the Alliance. Since 2001, FairTrade has directly intervened in courts in defense of the Safeguard Measures Act.

Last year, FairTrade is like a house on fire, doing a media campaign explaining to the public the results of the December 2005 Hong Kong meeting of the WTO and ended 2006 with numerous strategy meetings on how to push the various trade reform bills (IPR, trade representative office, anti-smuggling, etc.) side by side with the conduct of briefings on the ASEAN’s PIPs and the holding of a regional conference on the ASEAN Framework Agreement on Services (AFAS).

Reclaiming the Development Dimension of the WTO

Since its formation in 2001, the Alliance’s energies have been channeled to the task of critical engagement with the government – realized in the form of inquiries, information exchanges, dialogues, debates, participation in executive/legislative hearings and other similar modes of interfacing with government officials and concerned agencies – in order to push for trade policies consistent with the Alliance’s vision of balanced and progressive development based on fair and just trade and economic policies and programs.

Fresh from its participation in the December 2005 Hong Kong WTO Ministerial and amid the holiday festivities, the FairTrade organized a series of brainstorming sessions on the MC6 outcomes. The main line taken is that FairTrade should work for the defense and widening of the limited trade policy space of the Philippines and other developing countries based on the World Trade Organization’s Special and Differential Treatment (S&DT) principle. As a result, the Alliance came up with the document entitled: Reclaiming Development in a Multilateral Setting – Can We? addressed to President Gloria Macapagal-Arroyo, Sec. Peter Favila of the Department of Trade and Industry (DTI), Former Sec. Domingo Panganiban of the Department of Agriculture (DA), Sec. Romulo Neri of the National Economic and Development Authority (NEDA), Amb. Manuel Teehankee of the Philippine Mission to the WTO, and Tariff Commission Chairman Edgardo Abon. Members of both houses of Congress were also given the said document. The Alliance also explained to the nation, via the country’s biggest news network (on prime time of Christmas Day), what happened in Hong Kong and what the country should do to correct trade imbalances.

FairTrade also had continuing consultations with varied government offices, in particular with DTI, DA and the Tariff Commission.

While some areas of the society see victory in the suspension of the WTO in August, FairTrade sees it as a historic pause and an opportunity to reassess critically the Philippines’ integration in the global economy and redress our own trade and development imbalances by re-calibrating our trade commitments on the basis of our development needs and priorities.

In a paper entitled Redressing trade and development imbalances remains an urgent task, the FairTrade urged the government to use the suspension of the WTO as an opportunity to correct past trade mistakes, strengthen ties with other governments and institutions seeking reforms in the global trading system and launch a more balanced program of improving the country’s global competitiveness.

Exposing the perils of bilateralism

With the stalled WTO talks, pressures are being exerted by developed countries and unrepentant neo-liberalizers for the Philippines and other developing countries to join the bilateral bandwagon.

The Alliance has been critical of the Japan-Philippine Economic Partnership Agreement (JPEPA), which was signed on the sidelines of the Helsinki’s ASEAN-Europe Meeting (ASEM) held in September. It pointed out that JPEPA sidelines the development needs of the Philippines and further enhances the imbalances in the economic relations between the two countries. This is not surprising given the cloak of secrecy that surrounded the JPEPA talks. In fact, it was Fair Trade which called the attention of Congress, during the first JPEPA hearing of the Committee on Globalization, that DTI had shared only selective overview slides and tidbits of information on the proposed agreement. The FairTrade labor and agriculture affiliates and AKBAYAN filed a mandamus case in the Supreme Court for the JPEPA negotiators to disclose the full text of the agreement. Neither the draft of the agreement nor specific details on the scope of the JPEPA negotiating agenda were disclosed to the public from the time the talks were announced in 2002 up to the JPEPA’s signing in September 2006.

Also, in line with an ASEAN framework agreement, the Philippines is holding talks with Australia/New Zealand on the modalities for a possible free trade arrangement with the different ASEAN member countries. The FairTrade denounced the possibility of the Philippines having free trade talks with Australia and New Zealand (see attached statement Cure the trade imbalances with Australia-New Zealand! No to a Free Trade Agreement with Australia-NZ!). Yes, there is a need to hold trade talks with Australia/New Zealand, but there is no need to conduct such talks for purposes of concluding a free trade arrangement with Australia/New Zealand.

As for the Philippines-US bilateral trade talks, FairTrade is one of the first to expose and question the proposed trade talks. Like in the JPEPA, the RP-US trade talks appear to be shrouded in secrecy. Meaning no consultation with the country’s business community, with the trade unions, with the broad civil society movement and other stakeholders in society, and no draft agreement being released or circulated. Even both chambers of Congress are kept in the dark about the state of play in the RP-US trade talks. Just like in the JPEPA case, specific details of the negotiation parameters and goals are known only to a handful of negotiators.

As to the Philippines-China Free Trade Agreement, the FairTrade has always been critical to the proposal for a full free trade arrangement with China under the ASEAN-China Free Trade Agreement (ACFTA) framework, arguing that what the country and other ASEAN countries need is to engage China and ask the latter to help balance trade relations. In 2003-2004, the Alliance criticized the government plans to support the ‘early harvest program’ (EHP) with China and potentially-disrupting impact on Philippine agriculture and industry given the fact that China has been the main source of smuggled agricultural and industrial goods. Like JPEPA later, the EHP was surreptitiously approved by the government, although the list of EHP importables and exportables appears very selective. However, in a full bilateral free trade arrangement, targeted for 2010, this may not necessarily be the case. Hence, the need for vigilance.

Progress in FairTrade’s Legislative Campaigns

Aside from FairTrade’s engagement with the executive and varied industry and civil society stakeholders, the Alliance has been working with relevant and sympathetic Congress Committees (in the Senate and in the House of Representatives), legislators and Congressional staff to push for urgent trade policy reforms and remedies. As a result, the Alliance was able to formally register its position on trade issues such as the demand for a full disclosure by the executive branch of the draft Japan-Philippines Economic Partnership Agreement (JPEPA) and other bilateral trade agreements being forged with different countries (US, China, etc.), and subsequently, the Alliance was able to present its position in varied hearings called for evaluation of these agreements and other trade concerns.

More importantly, the Alliance was able to join forces with friendly and allied legislators and staff, together with civil society organizations with a regular and continuing presence in Congress such as the Philippine Legislative Committee on Population and Development (PLCPD), for the passage of various FairTrade bills and legislations.

Burying the flimsy economic arguments in support of cha-cha

As a rule, the Alliance does not dabble into partisan politics and tries to avoid being aligned with any particular political group or formation. However, on the raging charter-change issue in 2006, the Alliance had no choice but to take a stand on the economic aspects of charter change because some proponents were saying that growth and prosperity shall be better realized through greater openness of the economy (as if the economy is not open enough!) and a shift to the parliamentary system. The Alliance debunked the economic arguments by benchmarking the Philippine Constitution and the proposed economic changes with the charters of China, India, Thailand and other countries, which have more restrictive and protective provisions on land ownership, operations of public utilities and so on. The Alliance was also able to show that countries in Asia with a parliamentary system happen to have weak or soft economies such as Bangladesh, Indonesia, Nepal and Sri Lanka.

Results of the Alliance’s studies and reflections on cha-cha were integrated in the speech of FairTrade Lead Convenor Wigberto Tañada given in the Conference on “Implications of Liberalizing the Economic Provisions of the Constitution”, organized by the PCCI on July 14, 2006. The speech was printed in full in the BusinessMirror.

Subsequently, proponents of the cha-cha stopped using the spurious economic liberalization arguments as justification for charter change, focusing instead on the so-called political and governance benefits for the country.

Leading a High-Visibility Mass Campaign for Affordable Medicine

Since the l970s or for several decades already, consumers and health advocates have been advocating for the lowering of drug prices, which are beyond the reach of the ordinary people. But despite the passage of the Generics Law two decades ago, the prices of drugs have remained high; in fact, the Philippines’ drug prices are the highest in Asia, next only to Japan. There are two major reasons: first, the patent monopolies by the drug multinationals such as Pfizer, and second, the transnational corporations (TNCs)’s opposition to the moves of the government to avail of the flexibilities under the TRIPs of the WTO such as the right of member countries to undertake parallel importation of similar but cheaper drugs in the name of public health, fuller implementation of the Generics law and timely assistance to local drug companies willing to manufacture drugs whose patents are about to expire. Thus even if the FairTrade itself is not a health alliance per se, it is clear that it has a stake in the life-and-death issue of drugs. It is in this context that it responded positively to the request of various stakeholders in the formation of a broad coalition for affordable drugs called Ayos na Gamot sa Abot-Kayang Presyo or AGAP. (In English, AGAP translates to Right Medicine at Affordable Price; the Filipino term ‘agap’ also means timely.)

The coalition has attracted the support of broad sectors of society – barangay health workers, hospital workers unions, drug manufacturers unions, doctors and nurses, other trade unions, informal sector associations, concerned businessmen and a number of legislators. No less than the top-notch Senator of the land, Mar Roxas, has lent support to the AGAP campaign and has made AGAP a partner in lobbying for the passage of the Roxas bill seeking reforms in the patent system based on the TRIPS’ flexibilities. Other supporters are from the government – the Department of Health (DOH), Philippine International Trading Corporation (PITC), etc.

As pointed out, the campaign for affordable and quality medicine is focused on available trade and production flexibilities allowed by the WTO. The idea here is to take advantage of these flexibilities to ensure people’s access to affordable and quality medicine through the following – increasing the capacity of local drug manufacturers to produce critical drugs whose patents are about to expire; allowing the government and the private sector to import or source drugs from cheaper producing countries through the ‘parallel importation’ privilege of developing countries; regulating the predatory pricing behavior by the big drug producers, distributors and retailers; making the Generics law of the l980s really work; and enforcing all related laws and regulations supportive of the foregoing.

Several brainstorming sessions were held with various sectors and with concerned legislative and executive offices of the government before AGAP could be formed. The coalition was launched on May 23 at the Philippine General Hospital (see attached AGAP launching statement) and was attended by an overflow crowd led by Sen. Mar Roxas, PITC head Roberto Pagdanganan and leaders from the DOH and Bureau of Food and Drugs (BFAD).

AGAP and NEWSBREAK Magazine published a special report on the status of the Philippine pharmaceutical industry. FairTrade Lead Convenor Wigberto Tanada wrote an article entitled “Are Filipinos dying because of expensive medicines?”, while Atty. Elpidio Peria of Third World Network (TWN) and a co-convenor of AGAP contributed the piece, “Patents for profits.”

The significance of the Pfizer case

In the view of AGAP and the FairTrade, some of the country’s drug policies need urgent re-examination, especially the laws governing intellectual property rights. Certain provisions of the Intellectual Property Code (IPC) under Republic Act 8293 make it difficult for local drug manufacturers to secure compulsory licensing from research-based multinational companies as they are mired in expensive and time-consuming litigations even before they could start negotiations and manufacturing.

One example is the lawsuit filed by Pfizer against BFAD and PITC. Pfizer claimed that PITC infringed on its patent by importing Norvasc and submitting it to BFAD for product registration. Pfizer is now asking the court to issue a temporary restraining order (TRO) to prevent PITC from making, using, or offering the sale of and/or distribution of any Pfizer patent product while enjoining BFAD from entertaining applications for registration of Norvasc by generic companies.

Since it takes 18 months for BFAD to evaluate an application for drug registration filed by a generic company, what Pfizer really wants is to extend its monopoly over Norvasc for the remaining 18 months before its patent expires. BFAD and PITC have refuted Pfizer’s allegations invoking Administrative Order 2005-001 issued by DOH, which states that “the DOH through BFAD is mandated only to ensure the safety, efficacy, and good quality of pharmaceutical products for registration and it has no mandate at all to pass upon intellectual property matters since it does not have the legal authority, resources, and competency to do so.” PITC for its part said that it has not marketed nor sold a single Norvasc in the country and it has no intention to do so until after the Pfizer patent expires in June 2007. The only issue then is whether importing samples of a patented product such as Pfizer’s and submitting the same to BFAD for product registration constitutes infringement under IPC.

The case is still pending at the Makati Regional Trial Court under Judge Cesar Untalan, who favored a compromise agreement supporting Pfizer’s demand for PITC to stop any Pfizer product importation. With this development, the FairTrade together with Alliance of Filipino Workers (AFW), Philippine Ecumenical Action for Community Empowerment (PEACE) Foundation, Nationwide Association of Consumers, Inc., and the Community Volunteers Health Workers of San Juan filed a motion for intervention, arguing that the right to quality and affordable medicine will be adversely affected by any judgment upholding Pfizer’s complaint.

The AGAP coalition is pushing for the passage of a stronger Intellectual Property Code that will enable a level playing field in the local pharmaceutical industry such that generic equivalents of patented medicines can easily be brought to the market and provide lower-priced equivalents that are within reach of the Filipinos. The bill has been approved in the Senate and is awaiting approval by the House.

Networking in the Region for a People-Oriented ASEAN

The Alliance has been in the thick of the campaign for the social dimension of regional integration and has been networking among like-minded civil society formations in the region on this. Ironically, ASEAN is turning 40 and it is only now that it is formulating an ‘ASEAN Charter’. In 2003, at Bali, ASEAN proclaimed that by 2020, it will become an ASEAN Economic Community (similar to EU), a Socio-Cultural Community and a Security Community.

FairTrade has been active in the discussion on the ASEAN Charter and on the social and labor dimensions of regional integration. It attended the two national consultation meetings conducted by the Philippine EPG for the ASEAN, former President Fidel V. Ramos. The FairTrade’s Executive Director served as the facilitator for the economic workshop in both occasions.

FairTrade has also been in close contact with several regional trade union and civil society formations. In an ASEAN-European (ASEM) meeting held on May 11-12, the FairTrade, through its Executive Director (ED) Rene E. Ofreneo, presented options on ‘How Nation States Can Deal with Globalization’ before a huge gathering of trade unionists, CSO representatives, academics and government officials from the Philippines and various ASEAN and European countries. In a regional consultation by the UN Special Representative on Corporate Governance (UNSRCG) held at Bangkok in June, FairTrade, also through ED Ofreneo, identified the numerous TNC-led supply chains outside the garments and textiles industries as well as ways to bring CSR or corporate social responsibility at a higher level.

In September, FairTrade helped organize a meeting in Singapore with the Third World Network, the UNI Apro and the Friedrich-Ebert Stiftung dubbed as a ‘Trade Union-CSO Workshop on Regional and Global Integration’, which was timed to coincide with the IMF-WB annual conference held in Singapore. The conference was attended by ASEAN NGOs active among farmers, consumers and migrant workers in the region as well as by representatives of the ASEAN Trade Union Council or ATUC. Before the conference, the FairTrade ED facilitated a dialogue between Asian trade unions/NGOs and the Asia desks of the IMF and the World Bank.

The FairTrade has also been supporting the fair trade initiatives of the Pambansang Tagapag-Ugnay ng Manggagawa sa Bahay (PATAMABA), a national association of informal sector workers composed mostly of home-based women workers. PATAMABA has been networking not only in the Philippines but also in Southeast Asia through the Homenet Southeast Asia and Homenet Philippines. Thus, in November, FairTrade joined PATAMABA in organizing an International Arts Festival cum Fair Trade Exhibit and a Sub-Regional Workshop on Fair Trade and Social Marketing held in Angono, Rizal. This undertaking was intended to facilitate exchange of experiences among home-based and grassroots entrepreneurs, and strengthen/deepen their knowledge and skills regarding fair trade advocacy, product development and promotion through E-commerce, and other means, in the context of the issues and concerns, and aspirations of producers/workers in the formal economy.

FairTrade also helped organize a conference on ‘Services Sector Liberalization in the ASEAN: Development Challenges for Trade Unions and NGOs’, in cooperation with Union Network International – Asia Pacific Regional Office, Alliance of Concerned Teachers (ACT), and Education Network.

Notwithstanding the postponement of the December ASEAN Leaders’ Summit, FairTrade representatives went to Cebu and participated as resource persons and social activists in various conferences, forums, and round-table discussions organized by Asia Pacific Network on Food Sovereignty (APNFS), SAPA, AFAS, SEACA and SEAFISH. Earlier, the FairTrade attended the ASEAN People’s Assembly held in Manila.

Later, in January, FairTrade facilitated an informal dialogue with ASEAN Business Advisory Council (ABAC) President Jose Concepcion, ABAC Jakarta-based General Secretary and several business leaders attending the parallel meetings of the ASEAN Leaders’ Summit.

The main line taken by the FairTrade in all of the above activities: balanced development for all and putting people at the center of regional integration. Although the ASEAN has declared itself as a regional grouping of ‘caring societies’, the social dimension of regional economic integration is not clear, as growth has been uneven and exclusionary within and across countries. Clearly, ASEAN in the next three years is a battle field on the shape and the rules, social and economic, of economic integration. This is also an opportune time to forge stronger solidarity with like-minded groups (similar to FTA in structure or in orientation) within the region.

Giving Life to the Social Accord Based on the Framework of Building Up Social Partnership Decent Work, Productivity and Competitiveness

FairTrade is a product of social partnership among like-minded groups and individuals coming from industry, agriculture, formal labor sector, informal sector and civil society movement seeking fair, just and equitable trade and economic rules for the country. This partnership is reiterated time and again in various multi-sectoral activities and campaigns of FairTrade as well as in the signing of a Social Accord to save jobs, farms and businesses.

Last 2006, a serious effort was made by the FPI and its leadership in making social partnership work at the industry level. The FPI and FairTrade held several meetings and dialogues on how to give substance and meaning to past Social Accord commitments. The idea is to come up with operational and measurable parameters to make decades of social-accord signing a truly meaningful exercise.

Members of the FPI and the FairTrade labor affiliates have forged a social partnership in support of industry competitiveness and social stability through social dialogue, corporate social responsibility and responsible unionism. This was formally documented through a joint communiqué (see attached document Joint Labor-Employer Social Communique: Social Partnership on Decent Work, Productivity and Competitiveness) between industry and labor on November 28 at the historic Club Filipino. The focus of the communiqué is how to set aside decades of animosity between labor and industry in favor of a win-win but equitable program promoting competitiveness and productivity through observance of decent work and respect for the basic rights of both sides. Sympathetic representatives from academe have also been tapped to serve as mediators and educators/propagators on best practices on the above principles. The point of the communiqué is that it is not enough that a call for all to preserve and create jobs and businesses be made. This rhetorical call should be translated into the all-important task of identifying concrete measures on how to make industry competitive given the liberalized market and identifying areas where social partners can join forces, industry by industry and region by region, based on a mutually-beneficial arrangement.

Campaign against smuggling and dumping

Smuggling, both outright and technical, remains a scourge which distorts the business and economic field against the local producers who diligently pay taxes. It penalizes local industry and agriculture, and eventually the workers and farmers who lose their jobs and economic shirts due to this most unfair trade practice. Smuggling aggravates the unfair unilateral and one-sided economic liberalization undertaken by the Philippines ahead of other developing countries.

Given its organizational and budgetary limitations, the Alliance has focused its anti-smuggling efforts at the policy reform level, specifically in engaging the legislature for the early passage of an anti-smuggling law drafted with the help of FairTrade. The Alliance was active in the Congressional deliberations on the anti-smuggling bill, which was eventually passed by the House of Representatives; unfortunately, the counterpart bill in Senate, in the office of Senator Ralph Recto, has not moved for some strange reasons.

FairTrade has also held dialogues with the Bureau of Customs on possible improvements in customs procedures and valuation system such as the possible adoption of the risk assessment measures recommended by the FPI and benchmarking of customs procedures with those of the European Union, United States, Malaysia, China and other countries. The Alliance has also asked for the revival of the multi-sectoral committee against smuggling (MCAS). The problem, however, is that there are too many changes in the BOC leadership, which means the Alliance has had to build and rebuild communication lines with BOC every time there are changes in leadership.

Last 2006, FairTrade held a dialogue-consultation workshop with the BoC at Sulo Hotel. In the afternoon of the said workshop, the government conducted a raid on Mall 168 in Divisoria, the country’s biggest outlet for smuggled goods. However, weeks after, the mall reopened and is once again reputed to be retailing all kinds of smuggled goods.

Because of FairTrade’s actions in bringing to the public the scourge of smuggling, FairTrade was invited by Philip Morris International in a ceremonial destruction of smuggled and fake cigarettes confiscated by the BOC. Recently, FairTrade was invited to be part of the private sector advisory council of the Task Force Against Smuggling (TFAS).

On safeguards, FairTrade helped one affiliate organization, Chempil, against foreign dumping and smuggling of chemical products similarly produced by Chempil (see attached FairTrade’s position paper supporting Chemphil). The FairTrade labor convenor, Angel Mendoza, spoke in the DTI hearing for Chempil’s safeguards. Immediately, the government acceded to the Chempil’s demand for the application of the necessary safeguards.

The Alliance has likewise maintained its support for other industries like tiles, glass, ceramics and cement with regard to their application for safeguards.

Seeking a Win-Win Solution to the
Exodus of Health and Mission-Critical Talents and Skills

Acting on the complaints by affected industries, FairTrade launched a national campaign to raise the awareness of the nation on the threats to the survival of domestic industry in the light of the unchecked outflow or out-migration of critical skills and talents despite the existence of training agreements and employment contracts. Poachers from Singapore, Middle East, North America and Europe have no qualms in pirating these skills and talents and do not appreciate the survival requirements of Philippine industry and economy. Some industries such as the health industry, aviation industry, steel industry, etc. have indicated that their enterprises might collapse without the mission-critical skills or professionals, who are being poached left and right without any regards to their investment on the training of these people, the training contracts signed by these employees and without any consideration on the dislocating impact on industry of the sudden withdrawal of services by these mission-critical personnel. This is why the FairTrade held a National Conference on Mission-Critical Skills, an issue which was later picked up by the government in its Manpower Summit.

The Alliance also held several dialogues with the Department of Labor and Employment, in particular with DOLE Secretary Patricia Sto. Tomas and the Philippine Overseas Employment Administration Rosalinda Baldoz.

This resulted in the commitment of the POEA to tighten the monitoring of unlicensed manpower recruiters who are doing the unethical poaching. DOLE also issued an requiring pilots and other mission-critical personnel to file a six-month notice before they can leave the country. A one-page ad (see attached statement Saan Pupulutin Ang Pilipinas Kung Wala Nang Industriya?) was released by FairTrade on March 23. This generated a lot of discussion and debates, many positive and some negative, on the FairTrade stand.

In Congress, the House Committee on Labor asked FairTrade to assist it in bringing to the attention of the legislature and the general public the multi-sided aspects of the exodus issue. The Alliance helped draft the privilege speech and Resolution of Committee Chair Roseller Barinaga as well as in the conduct of the succeeding hearings.

The point is that the FairTrade succeeded in bringing to the public consciousness the exodus problem in the context of weak and liberalized economy. The poor integration of the Philippine economy has resulted in a weak agro-industrial development incapable of creating jobs for all. Thus, the problem on the (weak) demand side of the labor market is now reflected in the supply side of the labor market, as evidenced in the large number of informal workers (estimated to be as much as 65 per cent of the employed), a high rate of unemployment/underemployment and an equally large number of overseas Filipino workers (estimated to be over 5 million plus over 3 million immigrants). Lately, the supply side has witnessed the outflow or exodus of critical skills needed by industry and the unregulated poaching by outsiders, who do not bother to invest on training and education. This has disastrous results on existing industry and compromise the jobs of other workers staying at home. It is obvious then that a band-aid policy approach to the supply side – and demand side — will not work. Nor will a purely supply side policy favored by Washington Consensus work. An integrated HRD program, alongside an integrated agro-industrial development, is clearly in order.

Subsequently, other organizations like the Personnel Management Association of the Philippines (PMAP), Employers Confederation of the Philippines (ECOP), School of Labor and Industrial Relations (SOLAIR) of the University of the Philippines picked up the FairTrade’s campaign on the exodus of health and mission-critical talents and skills. PMAP talked with the Alliance for a possible conference-workshop on the challenge of having an integrated HRD and integrated agro-industrial development program. FairTrade also attended a conference – workshop in Baguio discussing the need to improve the curriculum of aviation schools as a way of addressing the country’s shortage of aviation personnel.

National Economic Roadmapping

The formulation and propagation of the FairTrade’s vision of development in the form of the Nationalist Development Agenda never stopped. In 2003-2005, NDA held a series of workshops and conferences on its vision of development, which culminated in 2005 in the holding of a national conference on its Nationalist Development Agenda.

The NDA is now being circulated among policy makers, media, various sectors and the larger Philippine society. It presents the FairTrade’s balanced approach to trade liberalization and development. The word ‘Nationalist’ is used in a positive sense – as an expression of the national aspiration of the Filipinos to become economically independent and be able to reclaim their collective sovereign right (from creditors and foreign vested interests) to determine the nation’s economic development priorities. Balanced approach to trade liberalization and development means a calibrated approach to liberalization, not a mindless embrace of liberalization and globalization. The FairTrade affiliates, especially its youth arm Youth Alliance for Economic Progress, are trying to popularize NDA (through popular education materials) and help propagate the NDA nationwide.

One major affiliate, the 72-year-old National Economic Protectionism Association (NEPA), an association of mainly small and medium enterprises, formally adopted the NDA as part of its advocacy program. And so are the labor and informal sector affiliates of FTA and, more recently, the Board of FPI.

Strategic Industry Road Mapping

The Alliance is also seeking to cascade national road mapping at the sectoral and industry level. This is especially urgent for distressed and vulnerable industries such as the garments industry (in the post-MFA era). FairTrade is now in touch with the DTI’s industry cluster head to operationalize some road-mapping for critical industries, starting with the garments and textile and the NAMA 5 sectors (fishery, footwear, chemicals, automotive, iron and steel).

For road-mapping purposes, however, researches, global/regional benchmarking and mapping of options are expensive necessities. Hence, success will depend on available support for such activities. Road mapping requires deeper analysis of defensive measures (preservation of existing industries), offensive measures (market access), niching-positioning and capacity-building.

Partnership with UNDP on ‘Managing Globalization’

FairTrade has also forged meaningful partnership with the United Nations Development Programme (UNDP), especially in the promotion of trade policy with a human face. FairTrade was the only civil society movement invited by the UNDP to be a partner in the national launching of the UNDP’s book publication aptly titled ‘Trade on Human Terms’, a 2006 Asia-Pacific UNDP Human Development Report. Part of the launching program is a large national forum on the Report where the FairTrade ED gave, in the words of a UNDP official, the most incisive analysis of the trade problematique in the Philippines.

With the support of UNDP and as summarized earlier, the FairTrade held two research presentations where concerned government officials were invited to exchange views on how to save and strengthen industries on the brink of collapse. One research presentation was held on August 18 on the textile and garments industry. Manuel Montes, Programme Coordinator of Asia Trade Initiative of United Nations Development Programme (UNDP) presented the UNDP’s MFA tracking report entitled “Flying Colours, Broken Threads”, while Joseph Francia of FairTrade presented his research on Philippine trade in garments, textile, yarn and fabric and other made-up textile materials. The above activity, a form of partnership involving the State and other stakeholders, reinforces FairTrade’s work in the Clothing and Textile Industry Tripartite Council (CTITC) where FairTrade labor is represented. There is also an ongoing dialogue by FairTrade with the DTI regarding the clothing and textile roadmap, one of the recommendations that resulted from the forum on garments.

Another activity involving the UNDP was held on October 6, this time a research discussion on ‘Gender and Trade: Analyzing Gender Issues in the Context of the WTO’. This was conducted in cooperation with the International Trade and Gender and Network (IGTN), Homenet Southeast Asia and Pambansang Kalipunan ng mga Manggagawang Impormal sa Bahay (PATAMABA).

FairTrade Today: Facing Up to New Challenges

2006 is clearly a banner, event-filled and another meaningful year for the Fair Trade Alliance.

For 2007, the Alliance seeks to do more of the same and sustain the various campaigns and initiatives outlined above, budget and resources permitting. The Alliance also needs to respond to the following urgent challenges:

Formulating Competition Policy

The debates and development choices involving modalities, new commitments and so on are likely to intensify, not lessen, in the next three years. The FairTrade has to address new crucial challenges such as formulating its own Competition Policy and how to react to the Aid-for-Trade initiative of the big powers.

Campaign for Agri Revitalization

Campaign for the Revitalization of the Agricultural Sector through the fuller implementation of the trade safety nets (competitiveness program, safeguards, modernization, etc.) and harmonization of trade and production policies. A Revisioning of Development in the Countryside in a Liberalized Trade Regime might be in order, as the old assumptions of agricultural development were based on an inward-looking economic arrangement. A US-style Philippine Farm Bill or a European-style Philippine Agricultural Policy or a combination might be a good idea too. All this is aimed at helping resolve the well-known crisis of Philippine agriculture, which is evident in the stark poverty in the rural areas, endless rural-to-urban migration and persistent rural insurgency. The whole idea here is to develop and promote a stronger affirmative trade and development advocacy for the agricultural sector.

Campaign for Tangkilikan or Networking

Tangkilikan is an old value of helping each other’s business or farm grow by supporting each other through patronage, sharing of technology, etc. One way or the other, various countries practice this, which explains why some countries have remained united and strong under global competition. Tangkilikan requires continuous improvement of goods and services; hence, there is a need to develop Tangkilikan certification of quality and the likes.

Continuing Battle on the Bilateral Front

With or without the Doha Round being concluded, the Alliance must prepare for a new battle arena – the bilaterals. JPEPA has been signed, the early harvest with China is being upgraded for full free trade status, and the US, Australia-New Zealand and others are keen in inking similar bilateral free trade deals with the Philippines. And yet, the country has not come up with a clear road map on bilaterals and spell out howthe country will benefit from such initiatives, which may even lead to more imbalances and trade/economic disasters for the country.

Taken from 2006 FairTrade Annual Report. For full report, click here.

(updated June 05, 2007)


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