With the world financial system imploding, it is time for protectionist measures as countries try to fend off the global effects of the meltdown: and, because of this, Philippine exporters should focus on markets that have trade agreements with the Philippines in order to go around such trade restrictions, advises the Department of Trade and Industry.
Senior Undersecretary for International Trade Thomas Aquino said on Monday Philippine exporters are now in what could be a better situation against competitors from other countries, because the Philippines managed to forge numerous trade pacts either through the Association of Southeast Asian Nations (Asean) or on its own.
These include the recently ratified Japan-Philippine Economic Partnership Agreement or Jpepa and the free-trade pacts of Asean with China and Korea. Philippine products also enjoy preferential treatment within the region under the Asean Free Trade Agreement (Afta).
Without these regional and bilateral free-trade agreements (FTA), Aquino said getting access to these major economies would be harder for exporters in the face of the economic turmoil.
In Japan, for instance, Aquino said the strengthening yen and the depreciating peso are making Philippine products a lot cheaper in the Japanese market.
In contrast, Aquino said focusing on the United States and Europe would be a bad move for exporters because aside from not having FTAs with the Philippines, these countries are also experiencing a slowdown in their economies.
"Instead of seeking other markets, we should focus first on these countries that have FTAs with us," said Aquino. "The way to look at it is there are less barriers [in these markets], so we are in a better position. We just have to exploit it."
He said the fact that the economic ministers of some countries are already calling on other countries to avoid coming up with restrictive trade practices is proof that national protectionist policies are now a real temptation.
On the local front, Aquino said the "Buy Filipino" campaign being espoused by the Federation of Philippine Industries is a "logical move and a very timely call."
He said it is about time Filipinos are reminded that there are quality products produced locally, and patronizing them would be a good way to stimulate the economy.
Aquino said even the government should concentrate its procurement activities on local products.