Introduction

The Philippines' membership to a growing number of comprehensive bilateral and regional free trade agreements warrants a closer look at the potential impact of these trade pacts on the country's agricultural sector. Its accession to three strategic and comprehensive free trade agreements, covering the ASEAN Free Trade Area–Common Effective Preferential Treatment (AFTA-CEPT), the ASEAN China Free Trade Area and, at the bilateral level, the Japan Philippines Economic Partnership Agreement (JPEPA), involves a commitment to a substantial degree of trade liberalization of its domestic agricultural markets. As a member of ASEAN, it has also signed framework agreements for closer economic cooperation with Korea and India and is presently deliberating on a probable ASEAN CER FTA with Australia and New Zealand. Other potential trade pacts in the horizon are the ASEAN EU FTA, as well as the RP-US FTA.

This study aims to look at the potential impact of these bilateral and regional free trade agreements on Philippine agriculture. The effect of these trade accords on agriculture is a key concern because the sector remains an essential segment of Philippine economy. The fact that agriculture is the source of livelihood for two thirds of the population's poor underscores the need to assess the impact of these agreements on existing vulnerabilities in the sector. At the same time, the paper hopes to put forward concrete policy recommendations that will help sustain the economic viability of small men and women farmers and stakeholders vis-à-vis the Philippines' commitment to growing number of free trade accords.

The paper is divided into four general sections. Part 1 presents a profile of Philippine agriculture. It includes information on the sector's growth patterns, its structure and composition as well as its over-all trade performance. This section also includes a brief discussion on Philippine agricultural policy, rural poverty and women participation in agriculture. It is intended to provide an overview of Philippine agriculture as a backdrop in evaluating the possible impact of various free trade agreements in the sector.

Part 2 looks at bilateral and regional free trade agreements in the context of over-all Philippine trade policy. It presents the interplay of unilateral, bilateral, regional and multilateral trade policies in the Philippines. It also looks at negotiating positions and development in the WTO as they interact with developments in bilateral and regional free trade agreements. This section of the paper discusses the general framework guiding over-all Philippine trade policy.

Part 3 presents the different bilateral and regional free trade agreements, including those that are still under deliberations, in which the Philippines is a party. This section of the paper includes a brief discussion on the background and/or history of each particular FTA. It also presents the provisions covering the agreement on trade in goods, particularly the modalities on tariff reduction. More importantly, it examines the trade flow patterns between the Philippines and each of the parties in the various free trade agreements. This information is helpful in understanding the Philippines' offensive and defensive interest with its trading partners.

Part 4 looks at the potential impact of progressive tariff reduction on key agricultural sub-sectors namely rice, corn, chicken and egg, swine, coconut oil and onion. The paper used prices and import volumes as indicators and means of assessing the country's competitiveness vis-à-vis other trading partners. Part 4 also includes a brief situationer for each of the commodity groups.

The study ends with recommendations drawn from consultations with stakeholders.

For a copy of the book, please email publications@centrosaka.org