by Lorie Ann A. Cascaro
Major Philippine exports like automobiles, auto parts, ships, boats, minerals, chemicals, handicrafts, jewelry, tuna and food items like canned pineapples, pineapple juice enjoy zero tariff rates to Australia and New Zealand. The exemption is provided under the ASEAN-Australia-New Zealand Free Trade Agreement (AANZFTA).
The AANZFTA was signed by the Philippine government during the 14th ASEAN Summit on February 27, 2009 in Cha-am, Thailand. It took effect on January 1, 2010 following the issuance of Executive Order 851 by Pres. Gloria Arroyo, modifying the rates of duty on certain imported articles as provided for under the Tariff and Customs Code of 1978, as amended, in order to implement the commitments on Trade in Goods Chapter of the Agreement Establishing the AANZFTA.
It is a comprehensive single undertaking free trade agreement (FTA) covering trade in goods, investment, trade in services, including financial and telecommunication services, electronic commerce, movement of natural persons, intellectual property, competition policy and economic operation.
The Universal Access to Competitiveness and Trade (U-ACT), the research and Advocacy think tank of the Philippine Chamber or Commerce and Industry (PCCI), stated that a number of major Philippine exports to Australia like automotive parts, including ignition wiring harness, batteries, wheels, tiers, yachts and vessels for transport, and agricultural products such as canned pineapples and tuna, have started to enjoy zero tariffs. U-ACT added that 84.7% of New Zealand’s tariff universe will have zero rates in 2010.
Tuna industry
The tuna sector in the country can take great advantage of this new free trade with Australia and New Zealand considering that bulks of tuna exports were mostly sent to Japan and the European Union. But, as of press time, the sector had not yet researched on the particular demand of the two countries.
“Di pa natin alam anong demand ng Australia at New Zealand kung canned or fresh tuna,” Alfredo Hebrona Jr., manager of Saranggani Chamber of Commerce and Industry, said during the forum on “Understanding the ASEAN-Australia-New Zealand Free Trade Agreement (AANZFTA)” held at the Apo View Hotel, Davao City last April 27.
Considering there is yet no regular shipment of tuna products to Australia and New Zealand, Hebrona said exportation of tuna to those countries is still exploratory. Hebrona added that the ban on fishing had affected not only the production of tuna but also more than 200,000 workers dependent on the industry.
Negotiation issue
Furthermore, Hebrona views a problem in the process of negotiation, saying that because the business sectors are not included in the negotiation, “we don’t know what’s being negotiated” in exchange of allowing us to ship goods to those countries. He said there is a possibility that they will sell products in the Philippines which may cause the death of another local industry.
The Mindanao Trade Negotiation Working Committee was formed by players from different sectors like tuna, pork, agricultural, and the chamber of commerce. Hebrona said the purpose of this committee is to assist the negotiators. “They don’t have the means to compose our sectors,” he said. To educate themselves on this trade agreement and to map on-going negotiations are the priorities of the committee according to him.
Meanwhile, U-ACT forged a partnership with the Department of Trade and Industry to undertake an information campaign on the benefits of AANZFTA in the cities of Davao and Cebu in order to increase awareness and to encourage business in the regions to avail of and maximize the benefits of the agreement.
