Trade alliance seeks tariff recalibration

Phil. Daily Inquirer, B-5, March 3, 2005

(similar story came out in Phil. Star, Manila Bulletin and Manila Standard)

Lead convenor of the multi-sectoral Fair Trade Alliance Wigberto E. Tañada yesterday said he would strongly push for the suspension of the tariff reduction program and seek a selective recalibration of tariff rates in a bid to save domestic industries and the farm sector from a self-destructive tariff regime.

The former senator said the economy had been severely damaged by the past and present administration’s fast-tracked and indiscriminate trade liberalization policy.

“By liberalizing too fast, we have unfavorably brought the country to a position of extreme disadvantage,” he said.

The country’s applied tariff on MFN now averages 7 percent, 8 percent for agriculture and 3.4 percent for industry. Under the Afta-CEPT (Asean Free Trade Area-Common Effective Preferential Tariff) program, the average applied rates are even lower.

“The other countries, on the other hand, are steadfastly standing their ground and are managing to cling on to tariff rates ranging from 20 to 40 percent or even higher. Over the past 10 years we have cut down our average MFN applied rates by more than 69 percent.”

Tañada statement comes ahead of a forthcoming review by the WTO Secretariat of the country’s compliance with WTO rules and a comprehensive tariff review called by Ambassador to WTO Manuel Teehankee.

Tañada stressed that his proposal for a suspension of tariff cuts and selective re-calibration of tariffs were within the rules of the WTO, stressing that these moves were “now very urgent” in the face of the weak performance of the industrial and agricultural sectors.

Tañada said, “President GMA cannot postpone any longer her decision on the issue so vital to our economic recovery and development.”

He said that the coming tariff review would give the government the opportunity to correct its mistakes which were still being committed up to know.

“We have effectively implemented a unilateral tariff disarmament, so now we no longer have any bargaining chips,” Tañada said, quoting former WTO Appellate Justice Florentino Feliciano.

Tañada added that the country could no longer compete in the global market and even in the local market.

“Aside from the fact that the safety nets promised to our local industries are not effectively in place we also have problems on technical and outright smuggling and other unfair trading practices,” Tañada stressed.

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