MANILA - Several groups urged the Senate to reject or defer the ratification of the Regional Comprehensive Economic Partnership (RCEP) free trade agreement.
RCEP is a free trade deal with the members of the Association of Southeast Asian Nations and economic giants China, Japan and South Korea, as well as Australia and New Zealand.
The Philippines remains one of the few countries in the group that have yet to ratify the free trade deal which has already been in effect since January 1 in many countries.
Proponents of the free trade deal say it will "strengthen regional economic integration; support an open, free, fair, inclusive, and rules-based multilateral trading system; and, ultimately, contribute to global post-pandemic recovery efforts."
RCEP is seen as the world's largest free trade area contributing to around $25.8 trillion or 30 percent of global GDP.
Some groups are concerned that RCEP will have a negative impact on the Philippine economy, especially the agricultural sector.
They said RCEP will allow more agricultural products from other countries to easily enter the country and compete with local products because of zero tariffs.
"Our agriculture sector has been, and continues to be, ill-prepared for free trade in the global market. Production costs are high. Basic support services and infrastructure are inadequate. Inputs, logistics and utilities are expensive. Marketing costs are prohibitive," said former Agriculture Secretary Leonardo Montemayor.
"Given these constraints, it will be difficult for us to compete with other RCEP members. Plus, we will be vulnerable to their cheaper exports, which are sometimes subsidized," Montemayor added.
CJ Castillo, Program Director of Labor Education and Research Network, urged the Senate to conduct more studies and simulation before acting on the matter.
He said based on their own research, several sectors will be negatively affected by the tariff adjustments under RCEP. Sectors that will be affected are agricultural particularly sugar, wool, silk-worm cocoons, wheat.
Also affected are electrical equipment and computer products, metals, machinery, ferrous metals, apparel and many more.
"Based on our calculations, domestic output will decline by about .076 percent. That's still a decline. And when you have a declining output, that will make a big impact on employment. And we are worried about this," Castillo said.
Montemayor added, cheaper products from other countries will now directly compete with local products that may be more expensive and this will negatively affect local industries.
Based on an earlier study, Montemayor said, the country stands to lose tariff revenues of about $58 million a year or about P2.9 billion annually.
He added, the Philippines do not need to join the RCEP as we already have existing free trade agreements with several countries.
The Philippine Senate will hold session only until February 4.