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APEC meeting in South Korea

It is very timely to review a policy that could alter, or already altered, the lives of the toiling Filipino people. I am referring to the General Agreement on Tariffs and Trade (GATT) and the implementor of this the agreement — the World Trade Organization (WTO) While I write this column, President Gloria Macapagal-Arroyo is in Busan, South Korea attending the meeting of the 21 member Asia-Pacific Economic Cooperation or APEC. APEC is the regional body that works for the strict observance of the GATT.

Among the systems institutionalized by the GATT is the liberalization of the economy of all WTO member countries. It opens the gate for easier entrance of foreign goods and services. Proponents claim this is good because it creates an environment where anybody can buy foreign goods at a very cheap price. That is if you have the money.

The agriculture sector is among those hardly hit by this policy. Agricultural products from other countries can easily enter the country. To make the entrance smooth, all barriers - tariffs and non-tariff restrictions - are to be removed, in fact, totally removed last year – 2004. This is a consequence of a country’s membership with the WTO. Thanks to then Senator Gloria Arroyo, who was among the proponents of a bill for the senate’s ratification of GATT, eventually finalizing the Philippine’s membership to the WTO.

One of the revenue sources of the government was the tariff imposed against foreign goods entering the country. With its removal, however, the government has to look for other sources of revenues. Now, it adopted the expanded value added tax against its citizenry while foreign goods entering the country have reduced or have no taxes at all.

But the more interesting issue to point out is the effect of the importation of agricultural products to farmers. Since all agricultural products will be allowed, the rice and vegetables from other countries will compete with the local ones.

A study of a student from Easter College, Daisy Akyaoan, found out that imported vegetables include ginger, broccoli, cauliflower, celery, carrot, cabbage, potato and lettuce. These vegetables come from USA, Australia, China, Holland, Netherlands, Belgium, Germany and New Zealand. She also found out that imported vegetables are not always those legally imported but smuggled.

In fact, even smuggled products captured by Customs officers can reach the local market when these are sold through public bidding if claimants failed to acquire the products. And the nature of the products require its disposal.

Akyaoan found that 340,000 farmers in the region or 55% of the total 543,000 employed in agriculture would be displaced if imported vegetables will compete with their products in the local market. 57,000 directly employed in farming in Mt. Province will be displaced too. What is interesting in her study is that the farmers are very aware of the effect of the displacement due to the vegetable importation.

Farmers lament that their expenses for their products - from land preparation to marketing - are hard to regain from the market prices of their products. They do not receive subsidy, so they are dependent on the pricing of their products for the return of investments.

On the other hand, their governments subsidize farmers from other countries (from production to marketing). By these, even if they sell their products at a lower price they will not incur losses. That is why even in our local market, imported agricultural products are cheaper than the locally produced.

In our country, subsidies for farmers are dangled only during election time. Worse, these funds are cornered by GMAs allies and failed to reach the farmer beneficiaries.

Since the Busan APEC meeting is still on going, I bet my last cents, GMA will always support APEC resolutions that will further the liberalization of our economy, including those that will further the misery of our farmers. She was among the sponsor of the Senate resolution for the approval of the GATT. She will continue to work for that policy. #

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