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Philippine Business Magazine: Volume 9
No. 3 - Visions
Intense Ties
Mutual security, prosperity, and service describe the United States’
thrust in the Philippines
By U.S. Ambassador Francis J.
Ricciardone
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| Ricciardone: For the US, the Philippines is
again “on the map” |
This is a particularly challenging, but also a
rewarding, time for all of those engaged in business between the US
and the Philippines. For the US, the Philippines is again “on
the map.” We understand again what we mean to each other, what
we can do for, and with, each other. We have turned a historic corner.
There has been a maturing in our bilateral partnership. The essence
of the mission I’ve been charged with here is to revitalize the
relationship; to put it on a more updated, mature footing, and to
grow it into a true partnership and a strong partnership.
So what is it that has changed things and brought us to understand
again our importance to each other? I see several factors. Two occurred
right on the same day with some amazing coincidences. On 20 January
2001, a new Administration took office in this country and a new Administration
took office in the US, both headed by children of former Presidents.
Both people had grown up knowing what it is like to be a President
of an important country and both with an outlook about their country’s
role in the world, in the region, and ready to engage on that.
Another factor of change, of course, was September 11, which caused
the US and most countries to look at the world in a very different
light. What are the things that really matter? How do we work with
each other in a new way? How do we face this common threat that is
not made for the 19th century world of borders and maps and passports
and paper currencies, but something that is a phenomenon of the modern
world where borders are no obstacles to criminals?
At the US mission in the Philippines, we’re focusing on three
broad sets of objectives: strengthening our mutual security; building
our mutual prosperity; and serving Americans and Filipinos.
First, on mutual security. We do appreciate the immediate and forthright
support of President Macapagal-Arroyo on September 11. We applaud
your President’s initiative in promoting regional counter-terrorism
initiatives. For our part, recognizing that terrorism is an international
plague, we’ve acted to promote our own security and that of the
Philippines by increasing our assistance and training with the Philippine
military in ways that we can discuss.
Let me now turn to a few of the economic activities of particular
interest that have occurred just these past ten weeks. What we believe,
in the US and, certainly in our Mission, is that what’s important
in fighting poverty, in promoting economic growth, is not US government
programs or grants to friendly countries that need help, but removing
the obstacles to growing our trade and investment together, as well
as removing internal obstacles to growth.
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What’s important in fighting poverty,
in promoting economic growth, is not US government programs
or grants to friendly countries that need help, but removing
the obstacles to growing our trade and investment together,
as well as removing internal obstacles to growth
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Overall, trade liberalization under the World
Trade Organization since Doha has also been a big net plus for the
Philippines, fueling a surge in exports rather than imports. Before
the current global crunch and the slump in electronics demand last
year, Philippine exports were growing at one of the highest rates
in the world. The acceleration in exports created thousands of good-paying
jobs in the Philippines.
The Philippines is the sixth largest beneficiary of the US General
System of Preferences for developing countries, which provides duty-free
access to the US market. Philippine exports to the US under the
GSP were US$745 million in 2000. GSP beneficiaries included not
only large exporters of electronics products, but also Filipino
workers in furniture manufacturing, handicrafts, and automotive
industries. Most of the US exports to the Philippines were machinery
and capital equipment and parts and inputs that are associated with
these export-oriented industries, like electronics.
The US has seen its trade deficit with the Philippines rise to over
US$4 billion. In part, that is due to restrictions in US access
to the Philippine market, which we regard as unfair and, ultimately,
damaging to both sides. On the other hand, the Philippines is a
very successful competitor in the world’s most open market
-- the US. Recently, the US and the Philippines reached an agreement
allowing the first shipment of mango exports into the US, and we
hope this is only the beginning of more fruit exports to the US.
The US is the largest direct investor in the Philippines, with a
cumulative actual investment in 2001, we estimate, exceeding US$3
billion. That’s a lot of money, but it’s not nearly what
I think it ought to be in a country with the potential of the Philippines
and with the ties that the Philippines enjoys with the US.
We have to do more to unleash the private sectors in our two countries.
For one example, last month’s Trade and Investment Council
resumed our dialogue on aviation, not only on safety and security
but also on “Open Skies.” Whenever we’ve had an Open
Skies Agreement with other countries, precisely those carriers that
were most reticent have turned around and become stronger in a very
difficult industry through the growth in traffic. And we believe
that can happen with the Philippines as well.
We also have sharply increased programs under the Agency for International
Development. There is a role for government support. With our AID
programs, we’re working particularly on supporting the Macapagal-Arroyo
Administration’s war on poverty. For 2002, the planned USAID
budget for the Philippines is US$74 million, including US$41 million
in projects for Mindanao. That doesn’t count the civil engineering
work that the US Defense Department is doing with your troops down
in Mindanao.
Finally, a very large part of our embassy is devoted to service.
We’re all advocates. We’re advancing many programs but,
particularly in this country, we’re here because of the service
requirements. There are over two million legal Filipino-Americans
or Americans who are permanent residents of Philippine origin. And
with 120,000 or more Americans in this country, that’s a lot
of human connections back and forth. Those human ties mean marriages,
births, deaths and visits, and visits mean visas. It’s business
and notarials. It’s questions about security. It’s helping
people who get sick. It’s helping people who go to jail, in
one country or the other. A large part of our embassy is devoted
to doing that human service work, and some of our best talent is
doing it.
I hope you’ve taken from this a feel for the breadth and the
depth of our ties that translates into real work and activity in
only a ten-week period. It’s intensive, gratifying, and it’s
actually fun. I’ve got a great team here because we do feel
we’re doing something important and something that matters
to our country.
Excerpts of speech by US Ambassador
Francis J. Ricciardone before the Makati Business Club, 16 May 2002,
Hotel Inter-Continental Manila
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