DTI: Japan free trade will fuel progress

The Supreme Court’s recent decision upholding the Japan-Philippines Economic Partnership Agreement, or JPEPA, will improve both nation’s friendly relations while supporting its strong growth momentum.

The High Court’s ruling was met with optimism by the Department of Trade and Industry as it is expected to open up more opportunities for stronger economic ties and increased foreign direct investments, or FDIs.

“JPEPA reflects our commitment to open markets and partnership building based on mutual rules,” said Trade Secretary Alfredo Pascual in hailing the ruling.

“We are pleased with the Supreme Court’s decision upholding the constitutionality of JPEPA. This reflects our commitment to open markets and partnership building based on mutual rules,” Pascual told Daily Tribune in a Viber message.

He emphasized the importance of JPEPA in strengthening the Philippines’ position as a “global player” seeking a conducive business environment and broader market opportunities.

The JPEPA, signed in 2006 and ratified in 2008, aims to liberalize trade and investments between Japan and the Philippines.

Pascual expressed confidence the ruling will “further support” the government’s trade policies under the Philippine Development Plan 2023-2028, which prioritizes strategic free trade agreements.

He assured that the agreement adheres to constitutional and policy requirements, ensuring responsible trade negotiations.

The Supreme Court dismissed two petitions challenging its constitutionality, one raised by environmental groups and the other by labor and industry representatives.

In the decision penned by Senior Associate Justice Marvic M.V.F. Leonen, the SC en banc denied the consolidated petitions for certiorari and prohibition filed by Initiatives for Dialogue and Empowerment through Alternative Legal Services Inc., or IDEALS, and FairTrade Alliance challenging the JPEPA’s validity.

The petitioners argued JPEPA jeopardizes public health and environmental protection by allowing the unrestricted importation of hazardous waste and violates provisions reserving certain economic sectors for Filipinos.

However, the court ruled that the agreement respects environmental regulations and upholds national sovereignty over resource use.

The decision is expected to boost investor confidence, particularly from Japan. Pascual anticipates increased FDIs in various sectors, contributing to economic growth and jobs creation.

He emphasized the need for continued efforts to “maximize the benefits of JPEPA” through capacity building and skills development programs for Filipino workers and entrepreneurs.

The JPEPA is the first bilateral free trade agreement of the Philippines. It was signed in Helsinki, Finland by then President Gloria Macapagal-Arroyo and former Prime Minister Junichiro Koizumi on 9 September 2006.

The Senate ratified the deal on 8 October 2008. The agreement officially entered into force on 11 December 2008.

“As a global player, the Philippines aims to strengthen economic ties, foster a conducive business environment, and broaden market opportunities,” Pascual said.

In denying the petitions against the bilateral deal, the Court ruled that JPEPA does not facilitate the indiscriminate importation of hazardous and toxic wastes into the Philippines.

“The JPEPA acknowledges that the parties are entitled to adopt and implement policies necessary to protect the health of their people and the environment. The JPEPA also reaffirms the Philippines’ and Japan’s rights and obligations under the Basel Convention on the Control of Transboundary Movements of Hazardous Wastes and Their Disposal,” the decision read.

The petitioners had further claimed that the Philippines’ commitments under the JPEPA, specifically to give Japanese investors national treatment, among other things, violated the Constitution and numerous Philippine laws imposing nationality requirements.

The second petition asserted that there was a gross imbalance in the parties’ agreement on tariff concessions, making the JPEPA an inequitable agreement that grossly disadvantaged the Philippines while greatly favoring Japan.