MIXED SIGNALS FROM MANILA ON WTO DOHA ROUND

C O N F I D E N T I A L MANILA 005800

SIPDIS

STATE FOR EAP/MTS, EB/TPP
STATE PASS USDA FOR U/S PENN; FAS FOR TERPSTRA, ROBERTS,
SHEIKH
STATE PASS USTR FOR MURPHY, HAFEMEISTER, DKATZ

E.O. 12958: DECL: 12/13/2015
TAGS: ETRD EAGR ECON RP WTRO
SUBJECT: MIXED SIGNALS FROM MANILA ON WTO DOHA ROUND

REF: A. A) STATE 207068


B. B) 211956

C. C) MANILA 05505

Classified By: ECON COUNSELOR ROBERT LUDAN FOR REASONS 1.4 (B) and (D)


1. (C) SUMMARY. President Arroyo expressed unequivocal
support December 9 for the US position at this week's WTO
ministerial meeting in Hong Kon (septel),but other senior
GRP officials have told us that the Philippines will "wait
and see" before taking a position. We would welcome feedback
on Philippine negotiators' position at Hong Kong. Public
skepticism continues here regarding the benefits of a
successful Doha Round. The GRP and farmer organizations
continue to put forth the argument that developed country
subsidies are the root cause of Filipino farmers,
difficulties. END SUMMARY.


2. (C) Despite a pledge December 9 by President Arroyo of
unequivocal support for the US proposal on trade
liberalization and agricultural subsidies with respect to
this week,s WTO Ministerial meeting and the Doha Round
(septel),Thomas Aquino, Senior Undersecretary at the
Department of Trade and Industry (DTI) and a key member of
the GRP,s WTO delegation, told Econ Counselor on December 9
that the GRP plans to wait and see how things play out
between the United States and the European Union. If the two
cannot agree, that will essentially set the tone for the
meeting, he noted. Aquino said that the Philippines is not a
major player in global markets, so the GRP expects the US and
the EU to find a consensus, then developing nations such as
the RP "will have something to look at."


3. (U) Aquino noted that the GRP cannot go beyond its most
recent services offer due to constitutional limitations; the
1986 Constitution reserves several sectors and professions
for Filipinos, including many in the service industries. On
Non-Agricultural Market Access (NAMA),the GRP,s general
position remains unchanged from previous WTO Doha meetings,
which is essentially against any further moves to reduce
tariffs, Aquino confirmed.


4. (SBU) Undersecretary of Agriculture for Policy and
Planning at the Department of Agriculture Segfredo Serrano
told AgCounselor recently that the EU proposal cannot be
evaluated solely on the market access pillar alone, as the
overall proposal has "fundamental problems." He added that
bludgeoning the EU in Hong Kong would be counterproductive,
comparing such an approach to attacking the U.S. domestic
support proposal as "disingenuous." With respect to
geographical indications, Serrano said he agrees with the
U.S. position, considering GI not to be a mandate of the
agricultural negotiations; rather, GI should be handled under
the TRIPS agreement discussions. GRP officials also
indicated suspicion of US/EU intentions vis-a-vis the various
support boxes, i.e., concern that domestic support in the
US/EU will change very little because current programs will
just be moved from amber to blue and/or even green box
policies, or the criteria for those support programs may be
changed.

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COMMENT
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5. (SBU) Unless President Arroyo produces a turnaround, we
expect the GRP to continue its cautious approach and to hide
in the background and seek cover through its membership in
various groups such as the G-20, G-33, and Cairns Group.
Since each group has disparate positions on the issues, the
GRP seems to be picking and choosing which positions it will
support, despite President Arroyo's show of support. The GRP
is unwilling to press the EU like fellow Cairns Group members
Australia and Canada because it wants to enjoy the greater
market access sought by developing countries; joining
Australia and Canada would be contrary to this goal. The GRP
seems to want a successful conclusion to the Doha Round, but
is not willing to assume any leadership to bring it about.

Jones