25.6.09
Of mad men
. . . is the topic of my latest Trade Tripper column in this Friday-Saturday issue of BusinessWorld. Excerpt:
"But that is the point. Although praying often (as we all well should), saints were never weak or passive individuals that avoided confrontation for a superficial peace. They were not — ultimately — cowardly or cynical or disloyal. Also, they were normal people who went to work, needed toilet breaks, got stuck in traffic, were betrayed by friends, suffered setbacks, followed the law, and juggled paying bills. And remember there are only two persons who walked this earth that never sinned: Jesus and Mother Mary. The rest, you and me (I’m an expert), including the saints, are vulnerable to sin. Temptations, failures, self-doubt, and difficulties come to us all. Even for the saints, life was always a daily struggle."
* * * * * * * * * *
Imports fell by a record 37.4%. No need for raising tariffs or protectionist policies then.
"But that is the point. Although praying often (as we all well should), saints were never weak or passive individuals that avoided confrontation for a superficial peace. They were not — ultimately — cowardly or cynical or disloyal. Also, they were normal people who went to work, needed toilet breaks, got stuck in traffic, were betrayed by friends, suffered setbacks, followed the law, and juggled paying bills. And remember there are only two persons who walked this earth that never sinned: Jesus and Mother Mary. The rest, you and me (I’m an expert), including the saints, are vulnerable to sin. Temptations, failures, self-doubt, and difficulties come to us all. Even for the saints, life was always a daily struggle."
* * * * * * * * * *
Imports fell by a record 37.4%. No need for raising tariffs or protectionist policies then.
24.6.09
The trouble with buy local programs
As expected with the much criticized Buy America program comes the retaliatory Buy China program.
One bad idea breeds another. For more details on China's growing protectionism, click here.
One bad idea breeds another. For more details on China's growing protectionism, click here.
23.6.09
New AB members
The WTO Dispute Settlement Body (DSB) appointed on 19 June 2009 the following two new members to the seven-member Appellate Body: Mr Ricardo Ramírez Hernández of Mexico for four years commencing on 1 July 2009 and Mr Peter Van den Bossche of the EC for four years commencing on 12 December 2009. The two replace Luiz Olavo Baptista, who resigned owing to health reasons with effect from 11 February 2009, and Giorgio Sacerdoti, whose second and final term expires on 11 December 2009. For profiles of the two new members, click here and here. The DSB also agreed to reappoint David Unterhalter for a second four-year term starting on 12 December 2009.
22.6.09
Tobacco, trade, and recession
US Tobacco Law signed, as reported by CNN:
"President Obama signed landmark legislation Monday giving the Food and Drug Administration new power to regulate the manufacturing, marketing and sale of tobacco. President Obama says the new law 'represents change that's been decades in the making.' The Family Smoking Prevention and Tobacco Control Act gives the FDA power to ban candy-flavored and fruit-flavored cigarettes, widely considered appealing to first-time smokers, including youths. It also prohibits tobacco companies from using terms such as 'low tar,' 'light' or 'mild,' requires larger warning labels on packages, and restricts advertising of tobacco products."
The interesting here is the probable effect the law has on fans of Indonesia's kretek cigarettes, which will most likely be included in the list of banned products. Reportedly, the problem for Indonesia is that the ban is only on the kretek but not on other, arguably similar, tobacco products such as menthol as this report states. The seeming existence of "less favorable treatment" could lead to a possible WTO dispute. More importantly for us, what effect does this have on our tobacco industry? What with Philip Morris being a major player here in the Philippines.
* * * * * * * * * * * * * *
Meanwhile, the World Bank predicts that the Philippines will "be one of the few countries in Asia-Pacific region to slip into 'outright recession'" this year.
In this regard, a PIDS paper entitled "Asia’s Underachiever: Deep Constraints in Philippine Economic Growth", which indicates that our culture, pervasive corruption, and outmoded institutions as the culprits behind our under-achieving economy, could be relevant reading.
"President Obama signed landmark legislation Monday giving the Food and Drug Administration new power to regulate the manufacturing, marketing and sale of tobacco. President Obama says the new law 'represents change that's been decades in the making.' The Family Smoking Prevention and Tobacco Control Act gives the FDA power to ban candy-flavored and fruit-flavored cigarettes, widely considered appealing to first-time smokers, including youths. It also prohibits tobacco companies from using terms such as 'low tar,' 'light' or 'mild,' requires larger warning labels on packages, and restricts advertising of tobacco products."
The interesting here is the probable effect the law has on fans of Indonesia's kretek cigarettes, which will most likely be included in the list of banned products. Reportedly, the problem for Indonesia is that the ban is only on the kretek but not on other, arguably similar, tobacco products such as menthol as this report states. The seeming existence of "less favorable treatment" could lead to a possible WTO dispute. More importantly for us, what effect does this have on our tobacco industry? What with Philip Morris being a major player here in the Philippines.
* * * * * * * * * * * * * *
Meanwhile, the World Bank predicts that the Philippines will "be one of the few countries in Asia-Pacific region to slip into 'outright recession'" this year.
In this regard, a PIDS paper entitled "Asia’s Underachiever: Deep Constraints in Philippine Economic Growth", which indicates that our culture, pervasive corruption, and outmoded institutions as the culprits behind our under-achieving economy, could be relevant reading.
21.6.09
18.6.09
Constitution, trade, and buy filipino
. . . is the topic of my latest Trade Tripper column in this Friday-Saturday issue of BusinessWorld. Excerpts:
"This reading of the Constitution was confirmed by the final arbiter of how the Constitution should be understood: the Supreme Court. Thus, in Tañada vs. Angara (GR No. 118295, 2 May 1997) the SC declared that 'economic nationalism should be read with other constitutional mandates to attain balanced development of economy,' that the 'Constitution does not rule out foreign competition,' and (most significantly) that the 'Constitution favors consumers [and that the] Constitution has not really shown any unbalanced bias in favor of any business or enterprise, nor does it contain any specific pronouncement that Filipino companies should be pampered with a total proscription of foreign competition.'
Accordingly, rather than confining itself by siding with a narrow protectionist perspective, our Constitution wisely took an even-handed, pragmatic approach that seeks competitiveness for those companies of ours willing to be competitive, promotes the general welfare, and provides our citizens that one important fundamental right inherent in a democratic and republican State: the right to choose.
Which now provides you the context with which to view the utility of relying on a 'Buy Filipino' movement: yes it’s legal if it’s a private-sector-driven program; whether it’s effective is another matter. According to trade remedy petitions data, the local ceramics industry has around 50% local market share, float glass around 85%, and with soap raw materials (such as STPP) having around 90% local market share. A political party’s declaration that since 'government is the single biggest spender [then if] all national and local agencies can consciously support the campaign by giving preference to locally produced goods and services, then this would be a good start' ignores the fact that our government procurement of local products (which is legal under the WTO) is already being done since the time of President Quezon through our Flag Law. Unless a complete monopoly is what is being sought, what all this means is that a Buy Filipino movement isn’t going to be that helpful as we’re already doing it."
"This reading of the Constitution was confirmed by the final arbiter of how the Constitution should be understood: the Supreme Court. Thus, in Tañada vs. Angara (GR No. 118295, 2 May 1997) the SC declared that 'economic nationalism should be read with other constitutional mandates to attain balanced development of economy,' that the 'Constitution does not rule out foreign competition,' and (most significantly) that the 'Constitution favors consumers [and that the] Constitution has not really shown any unbalanced bias in favor of any business or enterprise, nor does it contain any specific pronouncement that Filipino companies should be pampered with a total proscription of foreign competition.'
Accordingly, rather than confining itself by siding with a narrow protectionist perspective, our Constitution wisely took an even-handed, pragmatic approach that seeks competitiveness for those companies of ours willing to be competitive, promotes the general welfare, and provides our citizens that one important fundamental right inherent in a democratic and republican State: the right to choose.
Which now provides you the context with which to view the utility of relying on a 'Buy Filipino' movement: yes it’s legal if it’s a private-sector-driven program; whether it’s effective is another matter. According to trade remedy petitions data, the local ceramics industry has around 50% local market share, float glass around 85%, and with soap raw materials (such as STPP) having around 90% local market share. A political party’s declaration that since 'government is the single biggest spender [then if] all national and local agencies can consciously support the campaign by giving preference to locally produced goods and services, then this would be a good start' ignores the fact that our government procurement of local products (which is legal under the WTO) is already being done since the time of President Quezon through our Flag Law. Unless a complete monopoly is what is being sought, what all this means is that a Buy Filipino movement isn’t going to be that helpful as we’re already doing it."
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