Sun, Sep 10, 2006 - Page 11 News List

Japan, Philippines set to ink free-trade pact

LIBERALIZING ACCORD The two countries had meant to sign a free trade pact much earlier, but have been at loggerheads over the issues of labor and agricultural exports

AFP , HELSINKI

Japan and the Philippines were to sign a free-trade pact yesterday, after overcoming the thorny issue of Filipina nurses seeking work in the world's second-biggest economy, officials said.

Japanese Prime Minister Junichiro Koizumi and Philippine President Gloria Arroyo are to sign the economic partnership agreement in Helsinki ahead of the two-day Asia-Europe Meeting (ASEM) that begins today, Japanese government officials said.

The deal with the Philippines will be the first of its kind for Japan because it includes landmark provisions on the movement of labor.

Under the agreement, a limited number of Philippine nurses and caregivers will be allowed to work in Japan on the condition they pass Japanese qualification examinations.

The trade pact will also remove tariff duties on more than 90 percent of trade in goods between the two countries.

However, some Philippine agriculture exports to Japan, including tropical fruits, and some Japanese exports of industrial goods to the Philippines will remain subject to tariffs.

Two previous deadlines for signing the pact were postponed as the two sides remained at odds on various issues, with Tokyo seeking a more open investment climate in the Philippines and Manila pushing to send more workers to Japan, mostly nurses.

Japan last year tightened visa regulations to crack down on the trafficking of sex workers after coming under pressure from the US.

But the tougher visa rules led to protests in the Philippines, which feared that the restrictions would also affect legitimate workers. Eight million Filipinos -- 10 percent of the population -- work overseas and sent home US$10.7 billion last year.

Amid frosty relations with closer neighbors China and South Korea over its wartime record, Japan has been seeking warmer relations with Southeast Asia, including through free-trade deals.

Since the re-establishment of diplomatic ties, Japan has become the top aid donor to the Philippines, contributing US$9.4 billion over the past 23 years, or 51 percent of all foreign loans and grants to Manila in the period.

Japan's first free trade agreement, with Singapore, took effect in late 2002 and Tokyo has since signed deals with Malaysia and Mexico.

It reached a broad agreement with Thailand last year, while talks continue with Brunei, Chile, South Korea, Indonesia and the 10-nation Association of Southeast Asian Nations as a whole.

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