RP to loss Japanese market if it fails to approve JPEPA

PHILIPPINE NEWS SERVICE — As Filipinos whet the great appetite of Japanese for banana, mango, pineapple, avocado, watermelon and other tropical fruits, the Japanese in return, help Filipinos reduce the incidence of poverty.

This was the position made by government agencies during the inter-agency roundtable discussion on the effects of the Japan-Philippines Economic Partnership Agreement at the Dusit Hotel late last week.

“The Japanese have great appetite for the superior taste of Philippine bananas. We dominate the market and we want to retain the Japanese’s liking for our bananas and other fresh fruits,” said Trade Senior Undersecretary Thomas Aquino.

The Philippines is Japan’s major source of tropical fruits, supplying the market 79 percent of its bananas, 98 percent of its pineapples, 61 percent of its mangos and 48 percent of its papayas, according to the Philippine Institute for Development Studies.

Dr. Erlinda Medalla, PIDS fellow, warned that the Philippines could lose the Japanese market and global competitiveness for sustaining economic growth should the Philippines fail to ratify the JPEPA.

Aquino said the Philippines could lose the Japanese market for banana, mango, pineapple, avocado, papaya and other fresh fruits to Singapore, Malaysia and Thailand, which had separately inked an accord with Japan.

Other threats to Philippine export of fruits were Brunei, Indonesia and Vietnam, which would soon enjoy preferential tariffs in Japan following the ongoing trade negotiations with these countries similar to JPEPA, Aquino said.

“Without JPEPA, exports from Singapore, Malaysia and Thailand, as well as Brunei, Indonesia and Vietnam from the Asean will enjoy preferential tariffs in Japan, but not Philippines,” he said.

“The real threat on volume of banana and other fruits is there. The Philippine banana enjoys the highest market share in Japan. If we don’t have the agreement, we will lose this market. We want to preserve our competitiveness,” Aquino told the roundtable discussion, hosted by the Universal Access to Competitiveness and Trade (U-Act), headed by special envoy for trade negotiations, Ambassador Donald Dee.

“Let us defend that market,” Aquino said.

“The potential economic gains to be realized from the JPEPA would positively impact on poverty reduction in the Philippines,” Medalla said.

“Judging from substance and intention alone, the JPEPA does not look bad. If we reject JPEPA, we ran the risk of weakening our linkage with the region and losing competitiveness as the rest of our neighbors become more competitive,” she said.

The Department of Trade and Industry is counting on the JPEPA to bring about an increase of P221 billion in the total value of goods and services or the gross domestic product.

Medalla said the JPEPA could have positive net macro impact from a low of .09 percent (non-growth model) to 1.73 percent (with capital accumulation) to 3 percent (with productivity enhancement) of GDP.

After four-and-a-half years of negotiations, Aquino said the Philippines is “racing against time.”

“In two to three years, we could lose our market without JPEPA,” he said.

During negotiations, Aquino said the Philippine panel had to go “a bit soft” on negotiating tariffs on pineapples.

“We went a bit soft on pineapple tariffs during negotiations because we knew we had the upper hand but we realized we did not want to overrun their pineapple farmers in Okinawa. Just like the Filipinos, the Japanese farmers are human beings, too,” Aquino said.

Official records show the Philippines produced 3.56 million tons of bananas in 1998.

Japan is the biggest market for banana in Asia with total import of 885,140 metric tons valued at $435.7 million in 1997.

The biggest producing region was Southern Mindanao capturing almost half of the country’s total production.