Aquino’s first APEC

Posted: November 10, 2010 in Socio-Political
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President Benigno Aquino III leaves today for Japan to attend his first Asia-Pacific Economic Cooperation Summit amid the worst global economic crisis since the Great Depression and renewed terror warnings on the Philippines by several APEC member countries.

The APEC includes Australia, Brunei Darussalam, Canada, Chile, People’s Republic of China, Hong Kong, Indonesia, Japan, Republic of Korea, Malaysia, Mexico, New Zealand, Papua New Guinea, Peru, Russia, Singapore, Taiwan (Chinese Taipei), Thailand, United States and Vietnam.

APEC promotes free trade and economic cooperation. It describes itself as the “premier forum for facilitating economic growth, cooperation, trade and investment in the Asia-Pacific region… to further enhance economic growth and prosperity for the region and to strengthen the Asia-pacific community.” It also considers itself “the world’s largest forum for regional cooperation” covering 41% of the world’s population (2.7 billion), 54% of Gross Domestic Product (US$35 trillion) and 44% of worldwide trade.

This year, the agenda is aimed at recovering from the global economic crisis. “In order to recover from the economic crisis and ensure long-term growth in the region, we must further promote APEC’s trade and investment liberalization agenda and advance regional economic integration, says the APEC 2010 website.

“Human security is also important for ensuring a safe business environment in the region. In order to advance these measures, concrete capacity building activities will be essential. Indeed, all of the main 2010 APEC discussion “elements” are closely linked,” it added.

“Human security” in this context means mainly counter-terrorism and regional security. The concepts of Balanced, Inclusive, Sustainable and Knowledge-based Growth have been hailed as a new growth strategy for member economies. There is a token reference to inequality and the need for more “safety nets”. There is a call for the use of clean energy and for the maximization of profits through a knowledge-based economy (information technology, knowledge management).

For the APEC, recovering from the global crisis entails the more aggressive liberalization of economies coupled with regional security and stability. It is the same old neo-liberal story which plunged us into the crisis in the first place. It has embarked on the initial steps towards a possible Free Trade Area of the Pacific. It hopes to succeed where the WTO failed.

The APEC is desperately trying to find solutions to the crisis. Its neo-liberal economic policies have failed miserably to bring about real development especially for countries like the Philippines.

The APEC will ultimately fail to “solve” the crisis because it does not address the root causes which is the crisis of overproduction inherent in monopoly capitalism. So long as wages are low and workers are losing their jobs, this crisis of overproduction will continue to plague the world capitalist system.

Aquino’s agenda

For his first APEC, Aquino is expected to promote “balanced and sustainable knowledge-based growth that would prevent the widening gap between rich and the poor people and between advanced and developed countries, take care of the environment and natural resources, and use new technology to speed up progress.”

Aquino, an economics graduate of the Ateneo,  will also promote “increased human security, which involves counter-terrorism measures, counter-insurgency and disaster preparedness, promotion of food security, and combating infectious diseases.”

It is not sure if Aquino will get a chance to meet US President Barack Obama, other than the usual APEC photo ops. We don’t know if Aquino will take up the VFA during the side meetings. Aquino however promised to raise the issue of “travel advisories” to the concerned countries like the US, Canada and Australia.

The Philippines has expressed interest in joining the free trade alliance known as the Trans-Pacific Partnership which includes New Zealand, Singapore, Chile and Brunei, after the US expressed interest in joining the group. Member countries of the TPP have committed to the full removal of tariffs. The Philippine government is also expected to support moves for a Free Trade Area of the Asia-Pacific which aims to further liberalize economies and pick up from stalled Doha Round of the World Trade Organization.

In a time when globalization has wrought unprecedented damage to the global economy, the Philippine government should be putting the brakes on further liberalization of the domestic economy. It should be rethinking the discredited economic paradigm that has cost millions of people their jobs and driven so many countries into bankruptcy.

Latest government figures as of July 2010 pegs the Philippines unemployment rate at 6.9% and underemployment at 17.9%, conservative estimates based on a narrow definition of employment. Economic growth for 2010 is projected by the OECD and WB to be at 6%, still lagging behind many Southeast Asian neighbors.

The optimistic projections on economic growth may be due to the economic activity during the previous national elections as well as the economic activity spurred by OFW remittances. The Philippines is the 4th largest recipient of overseas remittances in the world, according a recent study by the World Bank. Some $21.3 billion in OFW remittances have entered the country this year.

The Aquino agenda does not address the fundamental inequalities between developed and developing countries. It seeks to reinforce these inequalities. The APEC framework serves primarily the interests of the US and other global economic powers and not the poorer countries like the Philippines.

Historically, the Philippines has experienced yearly trade deficits. For the first half of 2010, the deficit reached P10.9 billion according to the National Statistical Coordination Board.

The APEC may be another occasion to promote Aquino’s private-public-partnership which has been touted as the way out of the fiscal crisis and a path towards development. The PPP’s will only open up our economy to greater foreign plunder and exploitation. The alleged benefits will be severely outweighed by the long-term negative effects such as bigger public debt and profiteering by the private firms. Our history is replete with failed privatization projects. This month, the MRT, which is an example of private-public partnership, will be raising train fares to be able to pay its debts.

Incidentally, the Philippines will have a PPP road show on November 17-19, aimed at attracting investors for infrastructure projects. Most of the speakers in the event are foreign banks.

Will the country benefit from Aquino’s APEC trip? We doubt it.

Genuine economic development for the Philippines should be grounded on a program of national industrialization and genuine land reform. It said that these steps are necessary to address rural poverty and to make the country a self-reliant economy that would be free from dependency on foreign loans and foreign remittances.

To truly develop, we have to disengage from the policy dictates of APEC, WTO, IMF, WB and other imperialist instruments.  ###

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