Workers today slammed automotive firms in the country, short of calling them “selfish” and questioning their “loyalty”, for looking after their own business interest but disregarding the industry’s development and their employees.
In a strongly-worded statement, the Philippine Metalworkers Alliance (PMA) and the labor center to which it belongs, Sentro ng mga Nagkakaisa at Progresibong Manggagawa (SENTRO) defended the position of the Department of Trade and Industry (DTI) to impose safeguard measures on imported passenger cars and light commercial vehicles. The DTI was meant to achieve its twin objectives of protecting the domestic motor vehicle manufacturing sector and to save automotive jobs as imports of completely built up units dominate the local market.
“It is high time that our government protect Philippine manufacturers and their workers, starting with the autoparts and auto assembly sectors,“ the group pointed out.
“We note that throughout history, nations which eventually became industrialized had protected their manufacture, service-provider, and agricultural sectors,” the group said.
The group explained that the safeguard measure ordered by the DTI pales in comparison to the various protection measures that rich countries had provided before and continue to provide to their agriculture and industries.
“We are thus surprised by the statement of the Chamber of Automobile Manufacturers of the Philippines, Inc. (CAMPI) claiming that the provisional safeguard measures against imported vehicles ‘is yet another blow to the automotive industry,’” the group said.
In fact, the workers stressed that the safeguard measure was issued precisely to protect the Philippine industry which CAMPI represents and its workers. “It is therefore difficult to understand the position of CAMPI and puts the organization’s loyalty to the industry and workers it represents,” the group added.
Also, the PMA pointed out that importations of vehicles hurt local employment, and that unless security measure is imposed, local production would be swamped by importations, or the increased in models being imported.
The workers’ group also expressed surprise by CAMPI’s contention that there is risk in the short- and medium-term disruption in regional production and supply and that it will further slowdown regional economic growth because of a chain reaction to other industrial sectors.
“The safeguard measure on the contrary was designed to stop the ongoing disruption in the local production and supply created by the surge in imported cars, exacerbated by the economic downturn due to Covid-19 and ensuring the smooth entry of foreign-made automobiles while allowing our fledgling industry to be sacrificed is simply inexplicable and totally unacceptable, the group elaborated,” the statement added.
“It would seem that the CAMPI is more worried about the loss of business of foreign corporations operating outside of the country, and not Philippine-based companies,” the group said.
“Why is CAMPI not expressing any concern with the disruption in the Philippine production and supply brought about by the surge in imports? Why is CAMPI not worried about the disruption in the lives of workers and their families because of the loss of employment? Why is it not alarmed that countless formal and informal suppliers of goods to the local auto industry would lose their business, thus affecting adversely many workers and their families?” SENTRO said.
“Why is CAMPI more concerned that foreign manufacturers of vehicles and autoparts will be affected if the Philippines protects its own young auto industry? Is CAMPI and others who speak on their behalf only out to please their foreign bosses, the ones who installed them to their current positions and who could remove them? Hence, instead of working for the interest of the local firm and their workers, they are working for the interest of these foreign individuals and the foreign companies that they represent?.”
As to the supposed weakening of the “trade and economic relations triggered by retaliation by concerned exporting countries to the Philippines,” PMA said “suffice it to say that that the DTI is simply enforcing Republic Act 8800, “The Safeguard Measures Act”. Both the said law and the DTI order are consistent with the country’s commitment to the WTO. Consequently, any retaliation against the Philippines would be illegal.”
Further, the Philippine auto industry, which includes assembly and autoparts manufacturing, is an essential lynchpin of the country’s drive towards industrialization, which no less than an ADB economist recommended to the DTI. The Philippines need not remain a country of importers—we need to make our own products. We cannot jump from agriculture directly to services, ignore manufacturing, and expect to miraculously become an industrialized country, the group further quoted the said economist.
“It is for these reasons that the Comprehensive Automotive Resurgence Strategy (CARS) Program was put in place, precisely to improve the performance of the industry. This program entails tax expenditures by our country—all of which will be put to waste unless we nurture our local industry,” adding that the CARS program, “in fact, is along the lines of the extremely generous tax incentives being provided by many countries all over the world, including those that would supposedly be affected by the safeguard measures,” the group added.
In fact, the group said that the additional tariffs on some imported cars and vehicles will help the workers and the struggling local industry, which because of the pandemic need all the help not only from the national government but from the private sector as well.
Finally, PMA also said that the DTI should only be the start. What is needed now is a clear way forward for the local automobile industry. Specifically, the PMA would like to see the CARS program earnestly implemented, including the 3rd tranche. Likewise, new incentives for automotive companies who have been manufacturing in the Philippines for the longest period of time should also be developed.