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MANILA, Philippines — Automotive workers are pushing for the abolition of Article 27 of the Philippines-Japan Economic Partnership Agreement (PJEPA), which allows the entry of second hand motor vehicles from Japan during the review of the country’s first bilateral free trade agreement in December this year.
This was pressed by the Automotive Industry Workers Association (AIWA) at the consultation-dialogue “One Country, One Voice: PJEPA” Monday at the Philippine Trade Training Center.
AIWA president Angel Dimalanta has moved for the abolition of Article 27 saying this would further aggravate the situation of the domestic automotive sector, where imported completely built-up (CBU) units have already surpassed sales of locally assembled vehicles. The group said that before the PJEPA, the share of CBUs only accounted for 2 percent, but it grew to 52 percent post PJEPA.
With Article 27, the entry of imported used cars from Japan are likely to grow.
Dimalanta noted that although importation of second hand used vehicles had been banned under Executive Order 156 or the Motor Vehicle Development Program, which is being amended under the new MVDP or EO 877-A, and was even upheld by the Supreme Court. But, in reality, he said the entry of these used vehicles has not really stopped.
He said that importation of used vehicles continued to flow through the country’s various ports including Davao, Cagayan de Oro, Irene Freeport of Cagayan, Subic freeport, among others.
According to Dimalanta, the abolition, amendment or revision of a particular provision in the PJEPA is being provided for under Article 4 of the bilateral treaty.
He, however, was not so keen on the Philippines being able to strongly push for the revision or abolition of Article 27 noting this is only possible if the other party would agree to it. He said that even Article 4 needs to be revised because of a Constitutional issue that could be raised against it.
The workers further called for an assessment on what kind of jobs have been created under the bilateral treaty, which they said was highly disadvantageous of the Philippines. The first review of the agreement following its effectivity in 2009 is scheduled in December this year.
Trade and Industry undersecretary for international trade group Adrian S. Cristobal Jr. also admitted they have yet to clearly identify the needed revisions.
“We don’t know yet, so we have to study the impact to see what are the needed revisions,” he said. He, however, said that what is clear is the labor component side of the agreement, but added that he has to wait for the recommendations of the Department of Labor and Employment. So far, only two nurses have passed the nurses licensure examination in Japan to be able to work in a Japanese hospital.
He asked the stakeholders to submit their formal proposal whether the needed revisions would be in the form of operation, implication or substantive in nature.
Cristobal reported that despite the global recession that affected countries including Japan, the country’s exports to Japan attained high growth rates in 2009 with semiconductor growing 126 percent, apparel and clothing accessoeries by 110 percent and ceramic products by 107 percent.
In 2010, Japan was the leading Philippine export market accounting for 15.22 percent of total exports for a total of $7.8 billion or 26 percent versus 2009. In the January-June period this year, the country’s exports to Japan continued to growth by 13.39 percent versus the same period last year.
Japanese investments in the Philippines also grew 28 percent or P58 billion in 2010, majority of which were in the manufacturing sector particularly electronics products.
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By: Bernie Cahiles-Magkilat
Source: Manila Bulletin, Aug. 18, 2011
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