Group seeks RP exemption from Asean tariff regime

For domestic industries to fully recover from damages caused by typhoons Ondoy and Pepeng, the Federation of Philippine Industries (FPI) said that the government must invoke an article of the Asean Trade in Goods Agreement (ATIGA) that would temporarily exempt the country from the zero-tariff regime beginning next year under the Asean Free Trade Area-Common Effective Preferential Tariff (AFTA-CEPT) scheme.

In a statement over the weekend, FPI added that in a letter it sent to President Gloria Arroyo last week, the group appealed that the Philippines immediately invoke Article 23 of ATIGA, or the “Temporary Modification or Suspension of Concessions,” citing the “extreme circumstances resulting from the devastation of the recent national calamities.”

“Article 23 of ATIGA, which the government signed on February 26, 2009, legally allows the Philippines to temporarily modify or suspend its tariff reduction obligations due to emergency or exceptional circumstances other than those covered by Article 10 [Measures to Safeguard the Balance of Payments], Article 24 [Special Treatment on Rice and Sugar] and Article 86 [Safeguard Measures]” FPI said.

“Invoking Article 23 is justified given the current state of calamity in large parts of the country, and it is in situations like this that Asean [Association of Southeast Asian Nations] has intended this provision in the agreement,” it added.

Asean groups Brunei Da-russalam, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand and Vietnam.

During a telephone interview, Jesus Arranza, FPI president, told The Manila Times that all local industries should be shielded from potential stiff competition from imported goods that will come in with tariffs of only between 0 percent and 5 percent because of the AFTA-CEPT, which is scheduled to take effect on January 1, 2010.

Arranza also told The Times that the Philippines needs at least one year to rehabilitate its industries.

“We have to create a defense mechanism that will allow our industries to recover. The government’s reconstruction efforts should also benefit locally made goods,” he said. –Ben Arnold O. De Vera, Reporter, Manila Times