WASHINGTON - The Philippines will eventually have to join a market-opening trans-Pacific trade deal currently under negotiation once its market share, jobs and businesses start to suffer because of it, the country's finance minister said on Thursday.
The Philippines has not joined 12 other nations involved in negotiations on the Trans-Pacific Partnership (TPP) because of constitutional provisions limiting foreign ownership in some sectors it would need to open to join the pact. "Ultimately we'll get there," the country's finance secretary, Cesar Purisima, told a seminar on the sidelines of the World Bank/IMF meetings in Washington.
Purisima said this was despite the fact that Philippine President Benigno Aquino had decided that the best use of his political capital was in dealing with challenges that do not require changing the constitution. "That doesn't mean the Philippines won't step up to it, especially when the TPP is operational and you can see that it will be at a severe handicap for products that it competes with, especially with the four ASEAN members," he said, referring to Vietnam, Brunei, Singapore and Malaysia, which are part of the TPP talks.
Purisima said there was an initiative in the Philippines Congress, which was not supported by the president but was backed by some of his allies, to resolve the issue by adding the phrase "unless otherwise provided by law," to the constitution.
This would "move the problem away from the constitution to a more manageable legislative problem," he said.
"I think given time the Philippines will deal with this," Purisima said. "When the case is very clear and ... we are losing our market share and jobs and businesses ... we will have no choice but to act." Purisima said it would be better if the 10-member ASEAN as a whole was negotiating the TPP rather than just four of its members. "Individual ASEAN countries should not lose sight of the fact that individually they are very small," he said.
Central to the prospect of finalizing the TPP talks are negotiations between its biggest economies, the United States and Japan.
Negotiators said on Thursday that after two days of talks between the two sides in Tokyo they remained far apart, despite efforts to narrow differences before US President Barack Obama travels to Japan for an April 24-25 state visit.
The TPP, which would stretch from Asia to Latin America, is central to Obama's policy of expanding the US presence in Asia. Japanese Prime Minister Shinzo Abe has touted it as a main element of his economic growth strategy.
The United States wants Japan to open its rice, beef and pork, dairy and sugar sectors - politically powerful sectors Abe has vowed to defend.