Philippines, Asean Now Powerless Against Japan-Asean Trade Pact

A recently-signed free trade agreement between Japan and the Association of Southeast Asian Nations (ASEAN) would grant Japanese corporations unhampered access to the region’s markets, prohibiting ASEAN members to protect their own economy while allowing Japan to protect its domestic advantages.

According to IBON research head Sonny Africa, the signing of the Agreement on Comprehensive Economic Partnership among ASEAN members and Japan (AJCEP) is another step toward Japan’s plan for an overarching economic partnership agreement with the countries of East Asia. The agreement would allow Japanese corporations to take advantage of ASEAN markets, labor and natural resources.

“The Japan-ASEAN trade pact is part of Japan’s campaign to cement its economic power across the region,” said Africa.

He noted that Chapter 2, Article 15 of the AJCEP calls for each party to the agreement to accord “national treatment” to the goods of the other parties in accordance with Article III of the General Agreement on Tariffs and Trade (GATT). This means that ASEAN countries must treat imported products from Japan the same as their locally-made products.

He warned that this provision prevents the Philippines and other developing ASEAN countries from using trade barriers, such as tariffs, as policy tools for economic development. Like the experience of countries who liberalized prematurely, the pact could stifle the growth of many domestic industries in ASEAN nations as they are overwhelmed by a flood of cheap imports from Japan.

Under this unfair deal, ASEAN countries will be prevented from using the same protectionist policies that Japan itself used early in its economic development and may find themselves ultimately reduced to being sources of cheap labor and mineral and agricultural resources.

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