The conflict between China and the
Philippines over the resource-rich Scarborough Shoal is likely to derail plans
of selected Asian countries to integrate their economies by 2015, a chief
economist and a social science expert from the two countries said.
Cayetano
Paderanga Jr., economic planning secretary of the Philippines, said the
geopolitical conflict could drive potential foreign investments away from the
region.
“Yes,
there may be an impact—on interest rates, on investments,” Paderanga said on
Wednesday evening at one of the forums of the weeklong convention of the Asian
Development Bank at the Philippine International Convention Centre.
On a
similar note, Yu Yong Ding, a professor from the Chinese Academy of Social
Sciences and one of China’s delegates to the convention, said it was difficult
to ensure stronger economic cooperation among Southeast and East Asian
countries by 2015 if the Scarborough conflict would not be solved any time
soon.
“My
answer to that question is simple: ‘Yes,’” Yu said when asked if he believed
that the geopolitical conflict would affect plans of having an integrated
economic community in the region three years from now.
Nonetheless,
Paderanga and Yu were quick to add that Filipino and Chinese policymakers were
expected to resolve the conflict sooner rather than later as they were aware of
its adverse consequences.
“History
shows that we [Asians] are capable of cooperation,”
Paderanga
said. “There is no reason why we should stop now [from pursuing economic
integration],” he said.
“Policymakers
are wise enough to know that the matter must be resolved soon,” Yu said.
Tension
between China and the Philippines has escalated as vessels from the two
countries refuse to leave Scarborough
Shoal, a group of rock formations 220 kilometrEs west of Zambales province,
which the Philippines calls Panatag Shoal or Bajo de Masinloc. The standoff
continues as they trade accusations of aggression.
Although
the tension is much more pronounced between China and the Philippines, other
countries also claim islets and reefs in the South China Sea, which Manila
calls the West Philippine Sea.
Zero
tariffs on most goods
The
proposed economic integration of selected Asian countries—namely, members of
the Association of Southeast Asian Nations (Asean), Japan, China and South
Korea—is intended to help promote economic development among member-countries.
Stronger
economic cooperation among these countries is expected to make them less
economically dependent on Western industrialized countries, which continue to
struggle with serious sovereign debt and financial sector problems.
Under
the proposed economic integration, tariffs on most goods traded among
member-countries shall be brought down to zero or near zero, and rules and
restrictions on portfolio and direct investments will be relaxed and lifted.
Michelle
V. Remo
Philippine
Daily Inquirer
Business & Investment Opportunities
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