FINAL PLEA TO NEGOTIATORS: SAVE OUR SERVICES SECTOR, OPPOSE NEW DEAL ON SERVICES!

December 5, 2005

A few days before Philippine negotiators fly to Hong Kong for the 6th Ministerial Conference of the World Trade Organization, workers under the banner of the Stop the New Round! Coalition marched to the office of the National Economic Development Authority (NEDA) to make a final plea to our negotiators to protect local services sector.

In a letter addressed to Margarita Songco, the country’s chief services negotiator, the coalition expressed concern over the recently released draft ministerial text issued by Director General Pascal Lamy outlining what appears to be consensus over a new deal on services by Hong Kong.

“It is obvious that developed countries, especially those with aggressive interests in capturing the growing services market, want to seal a new deal on services in Hong Kong” said Josua Mata of Alliance of Progressive Labor. “We definitely see the hand of huge corporate lobby working here. They want to ram down the throats of developing countries a new deal on services despite wide opposition”, added Mata.

The services sector now account for 46% of the country’s Gross Domestic Product and has become the steadiest growing sector of the economy. In May this year, the Philippines offered to begin negotiations on liberalizing computer and related services, construction, distribution, energy, environmental services, financial services, transportation and tourism as part of the request and offers negotiations process under the General Agreement on Trade in Services (GATS). Recent proposals however from developed countries led by the European Union for “benchmarking and plurilateral approaches” have put additional pressures on developing countries to offer more sectors and commit to deeper liberalization.

“This plurilateral approach being pushed by developed countries is tantamount to coercion and should be strongly opposed by developing countries” according to Dave Diwa of the Kongreso ng Pagkakaisa ng Manggagawang Pilipino (KPMP). “What they really want out of GATS is Investments liberalization. Foreign service providers want a share of our services sector and they are doing everything to eliminate barriers to this, even our very own Constitution is at risk here” added Diwa.

One critical area being discussed in the negotiations amidst calls from developed countries for qualitative targets is the area of foreign equity and ownership restrictions on land and other assets.

The Philippines has been making a critical stand against benchmarking and plurilateral approaches. Together with other countries in ASEAN, it issued a statement recently against the draft ministerial text on services.

“Our plea to our negotiators is to stand up for Philippine interests in Hong Kong. A new deal on services would seriously limit our development options. There is no consensus on this and the Philippines should stand together with other developing countries to oppose this new deal in Hong Kong” added APL’s Josua Mata. #

Contact person:
Joseph Purugganan of the SNR Secretariat
433-1676 or email at josephp@focusweb.org

LETTER TO MARGE SONGCO

Ms. Marge Songco
Assistant Director General
National Economic Development Authority

Dear Ms. Songco,

In about a week from now, the Philippines will take care part in the 6th Ministerial Conference of the World Trade Organization (WTO) in Hong Kong. Of particular interest to your office is the General Agreement on Trade in Services or GATS. We in the coalition are alarmed over the latest twists and turns in the on-going negotiations on services. The recently released draft ministerial text on services issued by Pascal Lamy seems to provide the necessary mandate already for intensified liberalization of the services sector despite broad opposition from developing countries.

The Stop the New Round! Coalition , a broad coalition of around 34 national civil society organizations and social movements, has been monitoring the Doha negotiations since 2003, and has expressed its strong opposition to the proposed new trade liberalization agreements under the WTO. An area of critical concern in the services negotiations has to do with the proposals for benchmarking under the guise of complementary approaches. As you prepare to take part in this important conference in Hong Kong, allow us to express our views and demands on services liberalization.

As you very well know the services sector now account for around 46 % of our country’s Gross Domstic Product and represents one of the fastest growing sectors of the economy. Thus it is an area of importance not just to local service providers and companies but to the thousands of workers whose jobs are dependent on the sector.

We strongly believe that the liberalization of the services sector under the GATS is inimical to our national interest and we oppose the GATS negotiations on both substance and process.

On substance, GATS would lock us in to a system of trade in services that serves the interests of foreign services providers over local providers. Full liberalization of the services sector could have very serious implications on employment as small and medium sized players will be squeezed out of a more concentrated services market. It could seriously weaken the capacity of the Philippine government to regulate the entry of foreign firms as GATS rules provide opportunities for foreign firms to challenge domestic regulations if these regulations are perceived as restricting the entry of foreign firms into domestic markets. And lastly it could erode the access of the poor to services as the weight of WTO rules merge with the interests of the biggest services corporations.

On the process, the GATS negotiations have seriously undermined the flexibilities open for developing countries under the request and offers process. We find it scandalous that the trade superpowers are ramming down our throats their aggressive agenda of liberalization at all costs. The proposals for benchamarking, plurilateral and sectoral approaches are clearly intended to coerce developing countries into opening up more sectors and to commit to deeper liberalization more than they are willing and able to.

We support the critical stand by the Philippine negotiators in Geneva against these proposals for benchmarking. We hope that by working with other countries in ASEAN and other developing country groupings, that the Philippines would block this onerous deal on services from pushing through in Hong Kong. We reiterate our demand to the government that to take heed the principle “no deal is better than a bad deal” for the national interest and the interest of our workers.

Signed

Stop the New Round! Coalition

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