WHY is that for the most part it is the liberals and the political left that are most against free trade? While we believe that the US initiative, the Trans-Pacific Partnership (TPP), may not offer the best playing field for the Philippines, we strongly support free and fair trade agreements.
Former Akbayan Party-list Rep. Walden Bello, reacting to the launch of the world’s biggest free trade area comprising China and the Association of Southeast Asian Nations (Asean), said: “We have warned against the detrimental effects of free trade agreements with strong economic powers like China, Japan, the US and Europe. Unfortunately, all our fears have come true.” The words of Bello, the author of 15 books, should probably be taken into consideration. Except Bello made that statement in 2010.
Bilateral trade with China has been growing, registering about a 20-percent increase in 2014 in spite of tensions between the two countries. The “Bellos” of the country point to the fact that the Philippines has almost a $2-billion trade deficit with China. However, almost all of that deficit can be attributed to our importing Chinese electronic products valued at $1.6 billion.
Here is a suggestion to help mitigate the trade deficit with China. Stop texting about it on your Chinese-made cell phone or Apple computer product.
There are also those that believe that the oligarchs, the large companies that have a “too-large” a share of Philippine business, do not want the competition from free trade. If that is true—and we are not saying it is—then both the Left and the oligarchs have the same goal of wanting the people to be dependent on either “big business” or the government for their economic prosperity.
Without free trade between nations, we face the condition of autarky where an economy depends on consuming only what it produces and producing only what it consumes. That generally works badly as North Korea is the best example of autarky.
People and nations depend on each other through trade for their economic well-being. Try raising your own chickens if you doubt that truth. The division of labor among people and among nations is the essence of civilization.
Trade is the ultimate example of cooperation between nations. Otto T. Mallery, a late 19th-century economist in his 1943 book Economic Union and Enduring Peace, states, “If soldiers are not to cross international boundaries, goods must do so. Unless the Shackles can be dropped from trade, bombs will be dropped from the sky.”
The idea that for every “poor” Filipino working in a call center, an American loses a job is nonsense. Because Filipinos can provide a most cost-effective service to Americans, then America saves money to be utilized creating jobs at what they are good at and can sell their products to Filipinos.
The Left also says that with free trade, jobs will always go to the bottom of the economic food chain, limiting countries slightly higher up like the Philippine from getting richer. If that’s true, why are Mercedes still made in Germany and not in Haiti?
The choice comes down to “trade wars” or “free trade.” There are never any winners from a war.
9 comments
free trade is still the best ugly solution to the word economy. I wish Filipinos will debate more on issues like this than get too involved in political dramas. We cannot be complacent in a free trade environment; we need to find our best niches to avoid a head-on collision with economic giants where we won’t survive. Our agribusiness is vulnerable to both natural disasters and shaky policies. We cannot compete with Vietnam. Our manufacturing sector is almost zero. We cannot compete with China. Our tourism is immature. We cannot compete with Thailand. Our ports and financial hubs are strategically inferior to Singapore. The only bright spot that shines on us is the BPO sector, an industry that we can dominate worldwide (taking on a giant like India, ha!). Now let’s find more industries that we can conquer. But first, Filipinos should talk about this issue and vote their officials along this line of platform.
what about domestic help? Aren’t we dominating this sector? (in reply to myself for lack of a debate in this thread).
chrissunner, you’re a bigot suggesting Filipinos are all house servants!
So citing statistics make you a bigot now? You’re a genius.
what stats? your comment is anecdotal. look who the genius is.
You’re full of red tape. You must be from customs. Of course I didn’t have the time to dig up the stats here. But we all know Filipinos are one of the top suppliers of domestic helpers in the world. Just read the news.
Ironically in America, the liberals are railing against free trade, too. They blame free trade for job losses and the ruin of their middle class.
Problem is, when it comes to free trade the whole bureaucracy, policy-making bodies, and police powers of the country should be solid along the same line the way it’s done in developing the marketing strategy of big corporations. The country should have a focused policy that supports a focused industry that enjoys a focused educational system for skilled human resources and protection of our courts in the long run to be competitive. This isn’t happening. The macro policies are often not translated down the funnel at the micro level. Let me talk about one example: the herbal industry. Once upon a time, Congress passed the TAMA Act to promote the country’s herbal products. The act was translated by the DOH and created the Sampung Halamang Gamot as a way to encourage the private enterprise to develop the industry for domestic consumption and exports. Enter Ampalaya food supplements. When they started to chip away profits from multinational drug companies that make diabetes supplements and drugs, the powerful pharma lobbyists swung into action. Eventually, they’re able to “persuade” the DOH to pull out Ampalaya from its list of halamang gamot and the courts were in favor of the multinationals. How can you develop an industry when policies shift as easily as the wind changes direction? Had the private industry given its freedom to develop the industry, our farmers would have had a windfall from growing ampalayas on top of their rice farming. That’s just a small example why the Philippines won’t be competitive in a free trade.
I’m outta here.