President Arroyo's speech at APEC Ministerial Meeting, Aid for Trade Program
Asian Development Bank, Manila, 20 September 2007
Congratulations to the task force set up in Hong Kong for its valuable recommendation of October 2006. We are also glad to be made of aware of the continuing discussions of the Aid for Trade in the WTO Committee on Trade and Development in Geneva. We continue the saga of this program as we take great pleasure of being the host country of this high level Asia Pacific review for Aid for Trade.
AFT has rightfully brought together for the first time, the trade and finance communities. The convention highlights the Asian Dimension of Aid for Trade. This dimension is significant because the world is bullish on Asia's capability to help drive positive change in the world.
In this conference, governments, donors and the private sectors are working on dialogues on what is working in the region and what is not. They prioritize needs and move towards shared solutions. The discussions would result in proposals and recommendations on how Aid for Trade should proceed in the Asia and the Pacific. We look forward to beneficiary countries making trade a greater priority and donors scaling up trade-related official development assistance and offering their expertise. We also look forward to stronger partnerships with the private sector to increase and develop private-public financing. So this conference, indeed, helps create an impetus for collective action.
This meeting, I'm very glad, comes at a time, as President Coroda said, where the state of the Philippine economy brings hope and excitement. Growth is highest in our generation, the country's revenue is up, job creation is strong, our deficit is down, consumer confidence is up and inflation is holding steady. The 7.5 percent GDB increase that President Coroda mentioned and the 10 percent increase in capital investment are in line with what the Asian Development Bank says the country needs in order to replicate the poverty eradicating growth of Asia's economic success stories. Poverty alleviation remains the number one in our agenda and our vision to leave the Philippines in the ranks of modernized nation in 20 years. The foundation of our economic comeback is wide, deep and solid. Across the board, the nation's economy is pointed to the right direction and for all the right reasons.
Two days ago, I was reading an article in Biz News Asia and it says there are three reasons why the economy grew so strongly in the 1st half of the year – spending of the government, expansion of services which means telecommunication, business process outsourcing and banking and more industrial productions. There is plenty of money in the economy, that's why consumers and government were able to spend a lot. Overseas workers' remitted dollars, which converted to pesos and funneled into banks and used to buy housing from developers and cellular phones and e-load from stores or retailers, so that buoyed up the services economy. The biggest single act that buoyed up the economy, however, is the passage of the value added tax which, in one bold stroke raised enormous amounts of new revenues. We followed on the paying of back-straighting measures with the gain that comes from significant investments in people and progress.
We believe in strong global engagement for our country and our people to grow our economy and beat up our security and lift our nation out of poverty. The more ridges we build, the more people can cross to new lands and new ideas. We must be open to the world, and people and places other than our own. That is what the 21st century is all about. That is what the WTO is all about.
We believe in the power of the global trading system to alleviate poverty and modernize nations through market sources. That does not mean, we believe, countries like the Philippines are ready to compete head-to head today in every sector. That's why we have Aid for Trade. What I mean is that we cannot afford to be afraid of globalization. The multilateral trading system through the DOHA rounds remain the best option to address poverty and improve standards of living throughout the world because that is the trading arrangement which agrees with the international trade rules. It offers a major opportunity to put in place internationally significant reforms, a reduction in trade-distorting domestic support, create meaningful and substantial market access in agriculture, industrial goods and services, and introduce improved rules and better trade facilitation arrangements. This conference shows that we do not overlook the fact that the DOHA development round was launched with the emphasis on integrating developmental dimension into all the elements of negotiations. WTO, acknowledged the need for special and differential treatment for developing members, who require maximum flexibility under the international trade rules.
I was reviewing the Philippine position papers from the onset of the DOHA negotiation. And I remember coming across and I went back to it. My instructions to my negotiators there, part of the Philippine position to make the DOHA round truly a development as its been build, first there must be a coherence and convergence of policies among international economic institutions such as the World Bank, IMF, ADB, WTO so that trade is mainstreamed in the development agenda and therefore capacity building can be focused and targeted. And second, we must review the special and differential treatment to meet not just the facing of commitments but also capacity building and sufficient flexibility to pursue domestic development goals. And what is this conference about, exactly those two things that we said from the beginning to make DOHA truly a development ground.
That's why I am happy to be in this conference. This meeting is also well-timed as a global event, coming at the hills of the APEC leaders meeting in Sydney that signaled the need for breakthroughs in the WTO negotiations, alongside more focused and more strategic capacity building among member economies. We remember that it was the developed nations who were the prime movers behind global trade when it suited them. Now, some countries are slowing things down and that's not right nor good for our respective economies. But there has been a ray of hope in APEC with the developed WTO members declaring, that they are willing to fully adhere to the DOHA mandate, in particular domestic subsidy cuts and disciplines but they also asked to gain access to the developing world's markets.
We appreciate Pascal Lamy's visit to the Philippines not just this time but last February. I told him then and I say it again that I believe it is in his hands because he knows everybody's minimum and maximum positions. It's in his hands to find the right formula of subsidy cuts on the one hand, and market access that will finally break the impasse. And I am glad to have heard from him, as we were walking to this stage, that we are really moving on forward.
I was reminding the two gentlemen, who were escorting me, that we are not yet eight years in DOHA so we are still not hopeless. But let me be clear, even as we work tirelessly to move the talks forward, we could not stand by and do nothing. For us, it's full speed ahead, preferably with DOHA. But in the meantime, full speed nevertheless. We recognized that the fragmentation of the multilateral trading system into trading blocks will result in a more complex set of trade rules that are incompatible and detrimental to the interest of developing country members. It is only a second solution but is a better solution for the moment than just each one playing it alone. So meanwhile, with the hope that there will be a successful conclusion to the DOHA round, we are maximizing the economic opportunities provided under the bilateral and regional free trade agreements, if only to complement efforts under the multilateral trading system.
I hope this Asia Pacific conference ensures that WTO does not become a sideshow in global affairs. Asia and the Pacific are too important and WTO has too much promise for that to happen. So let us all work to make this conference a success. Thank you. (OPS) [top]