Charter change, Economy

EU and DFA deceiving the public on European lobby for Cha-cha

The Head of the European Commission (EC) in the Philippines, Mr. Alistair Macdonald, and the Department of Foreign Affairs (DFA) are deceiving the public by claiming that there is no “request” from the European Union (EU) for the Philippine government to modify the 1987 Constitution, specifically to lift the constitutional ban on 100% foreign ownership of land and foreign practice of certain professions in the country.

Such document exists and is actually available online. Click this link and browse the page and look for the link “Philippines” to access the document in PDF format.

This document, which the EU has attempted but failed to keep secret, forms part of the negotiation process for the General Agreement on Trade in Services (GATS) of the World Trade Organization (WTO). The objective is to achieve further economic liberalization through a “request and offer process”, i.e. a country will submit a list of sectors it wants liberalized, identify the legal barriers to  foreign investment, and request that such barriers be eliminated. The party to which the request is made will then have to make an offer (which sectors the country is willing to eliminate the barriers identified by the EU). The EU made a request to a total of 109 WTO members, including the Philippines.

Reading this document, one would not find the phrase or term “Cha-cha” or an explicit request to modify the Constitution. Instead, the document simply enumerates the identified liberalization barriers and then proposes that such barriers be eliminated. For instance, on page 3 of this document, we will find these entries:

  • Participation of foreign investors is limited for certain expressly reserved activities reserved by law to Philippine citizens (MA). EC request: Eliminate this requirement of citizenship…
  • Acquisitions of land (MA) require 60% local capital. Foreign investors may lease only private owned land. EC request: eliminate

Limits on foreign investors on certain economic activities and land ownership are implemented because the 1987 Constitution mandates the government to do so, obviously to protect the national interest. By requesting that these prohibitions be “eliminated”, the EU is in effect lobbying for Cha-cha to accommodate their “requests” under the GATS.

External pressure from the rich countries to implement Cha-cha for more economic liberalization has already been raised in the past. In fact, it is the Americans, and not the Europeans, who are more vocal and explicit in their demand for Cha-cha to allow unbridled foreign investments in the Philippines. While the EU veils its Cha-cha lobby under the negotiation process of the WTO-GATS, US-based corporations bluntly state in their official papers the need for Cha-cha.

The American Chamber of Commerce of the Philippines Inc. (AmCham), for instance, candidly said in its advocacy paper “The roadmap to more foreign investment” that when the 1987 Constitution is amended, restrictions on foreign investment and land ownership should be removed. In its 2006 Investment Climate Improvement Project (ICIP) advocacy plan, AmCham vows to seek “removal from the Constitution of all restrictions on foreign investment and professions” to “further liberalize the foreign investment regime to bring needed capital, skills, and technology into the country.”

AmCham’s ICIP, which aims to initiate investment climate reforms in the Philippines, is being funded with an undisclosed amount by the US government.

Meanwhile, the office of the US Trade Representative (USTR), an agency of the US government in charge of directly negotiating trade agreements with foreign governments , as well as resolve disputes, and participate in global trade policy organizations, has identified several provisions of the 1987 Constitution that it considered as “trade barriers.”

These papers are all publicly available, just Google them.

Over and above the narrow, self-serving political agenda of the Arroyo administration, there has always been intense and persistent pressure from the rich and powerful countries to implement Cha-cha and liberalize the economy. While the Philippine economy has already achieved a relatively advanced level of liberalization, such opening is still not enough to meet the insatiable need of powerful countries like the US for markets and profit-making opportunities. And as Arroyo herself has declared, the next phase of liberalization in the Philippines will be in the form of Cha-cha. Arroyo and her clique have been riding on this imperialist agenda to implement their own political agenda to stay in power.

Thus, if Cha-cha is implemented, we will end up with the illegitimate Arroyo government and at the same time surrender to the US and EU whatever is left of our lands, our jobs, our industries and our economic sovereignty.

The people must defeat this evil scheme.


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