Trade-related Aspects of IPR: A Major WTO Concern and Its Implications on the Philippines by Ronald Yacat

Vol. XVII No. 2

March - April 1999

ISSN 0115-9097

Trade-related Aspects of IPR: A Major WTO Concern and its Implications on the Philippines* Jose L. Guerrero**

Backgrounder: GATT and WTO

Along with most of its Asian neighbors, the Philippines is signatory to the General Agreement on Tariffs and Trade (GATT) and a member of the implementing body, the World Trade Organization (WTO). In the GATT Uruguay Round in 1986, provisions on trade-related aspects of intellectual property rights (TRIPS) were included. Member countries are committed to uphold these provisions by adopting measures that will address the issue of piracy and other violations against intellectual property rights (IPR). With fast emerging industries and vast advancements in high technology, countries are hard pressed to comply. How do these affect the Philippines? And what do they imply for the future?

WHAT'S INSIDE 2

Closing the Urban Fiscal Gap: A Challenge for Local Government Administration

4 5 14

Strengthening APEC in the Light of the Asian Crisis ASESD: A Training for Researchers and Practitioners The Corporate News

k WIFM: Giving Better Presentations for Better Understanding

k Supervision: A Challenge and a Commitment

k Planning for Wider and Better Dissemination: The RIS Workshop

———————— * Based on the author’s keynote speech entitled “GATT/UR and WTO’s TRIPS: Effects on the Philippines” delivered at the Joint RINSCA/RINSEAP Meeting and ABA/UNESCO Regional Forum on “Online Services in Asia and the Pacific,” Bali, Denpasar, Indonesia, March 23, 1999. ** Director, Science and Technology Information Institute (STII), Department of Science and Technology (DOST), Republic of the Philippines.

There is no stopping the advent of a new millennium. Every day that passes means one less opportunity to prepare for the challenges that the 21st century will bring. For the global community, the remaining days of 1999 are being spent in trying to comply with major changes, a “new world order” of sort that shall prevail beginning the year 2000, the most popular of which is for all computer networks and mechanisms to be Y2K-compliant.

The General Agreement on Tariffs and Trade (GATT) is not an organization but a group of contracting countries which have acceded to a set of provisions and regulations governing trade among themselves. Before it was transformed into the World Trade Organization (WTO), the GATT did not have a legal identity of its own and sovereign states which have all agreed to adhere to a negotiated set of trading rules were known as contracting parties, not member states. By the end of 1994, 128 contracting governments subscribed to the GATT. Together, these contracting parties accounted for almost 90 percent of world trade.

EDITOR'S NOTES Another big challenge—though relatively less openly discussed in the media— is the commitment for member countries of the World Trade Organization (WTO) to comply with the provisions of the TRIPS or trade-related aspects of intellectual property rights on or before January 1, 2000. The TRIPS provision in the WTO is a critical step meant to check intellectual property piracy

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DEVELOPMENT RESEARCH NEWS

Urbanization: Boon and bane

March - April 1999

Closing the Urban Fiscal Gap: A Challenge for Local Government Administration*

Urbanization has certain advantages. As urbanization proceeds, economies tend to agglomerate. This results in higher productivity as compared with the rest of the economy. Cities are likewise better able to capture the benefits from economies of scale, bringing about reductions in unit cost of delivering certain types of services like sewerage treatment, public transportation and the like. Urbanization also increases the taxable capacity of cities such that more revenues can be mobilized from the same jurisdiction. However, urbanization also leads to a number of problems. Congestion is obviously one of the primary and immediate results. It causes diseconomies like air and water pollution, slum settlements, and increased need for disease control and fire/police protection. Basic services like water, telephones and health facilities also become critically inadequate.

How, then, can the benefits of urbanization be optimized and its resulting drawbacks contained? Two types of responses are known to have been made to address these concerns. One is to impose controls on rural-urban migration and rapid population growth. Another is to find efficient ways to manage and finance the urban sector. This write-up which is based on a study on urbanization under a decentralized regime by Rosario G. Manasan and associates focuses on the latter— searching for ways to finance and deliver adequate public services in urban areas.

Heart of the problem: Fiscal gap The reason for the inadequacy of basic public services in large cities is that urban local government units

(LGUs) are unable to fund the delivery of the right quantity and quality of these services. These LGUs suffer a financing problem known as “fiscal gap.” This is defined as a gap between perceived service needs and available financial resources. This is different from the concept of “fiscal deficit” which reflects a shortfall of actual revenue collection relative to actual LGU expenditure. The fiscal gap is usually experienced by large cities because urbanization exerts an upward pressure on LGU budgets but LGU revenues may not respond as quickly and strongly to the demands of rapid population growth. Thus, while population growth, urbanization and growth in per capita income all tend to expand the revenue capacity of urban governments, the growth in LGU revenue may not automatically expand since it is held back by the LGUs’ limited taxing authority and lagging revenue efforts. The key to bring adequate public services to the urban sector is therefore to close the fiscal gap. To achieve this, more money should flow into governments and conversely, service delivery must be more efficient in order to save money for government coffers. The solution may sound simple but is pervaded with system-wide policies and ———————— This is a shorter version of PIDS Policy Notes 99-02 entitled “Closing the Urban Fiscal Gap: Some Considerations” by Rosario G. Manasan, Senior Research Fellow at the Philippine Institute for Development Studies (PIDS). *

procedures that serve as barriers to the closing of this gap.

Dissecting the urban fiscal problem To understand where some of the root causes of the problem lie, it is important to look closely at what ails the revenue and expenditure processes being undertaken by city local government units (CLGUs) and see where and how more funds can be generated and saved.

Revenue performance: Effects of urbanization not fully optimized For the period 1991-1995, Manasan and associates measured LGU revenues in terms of per capita total LGU income and two components of per capita locally-generated revenues: per capita local business tax revenue (PCLBT) and per capita real property tax revenue (PCRPT). They found that the degree of urbanization had a positive and significant effect on PCLBT. On the other hand, its effect on PCRPT is also positive but not significant. Apparently, this was because the real property tax system had not been able to fully gain from the positive effects on land values brought about by urbanization since increases in property value in urban areas were not immediately reflected in the statutory tax base. At the same time, CLGUs had gotten a false sense of security by the internal revenue allotment (IRA) they receive from the national government. Instead of encouraging local governments to push harder and improve their local revenue generation effort, the IRA

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became a substitute source of income for LGUs and thus even served, albeit inadvertently, as a disincentive for LGUs to raise their income-generating efforts.

in terms of a higher LGU fiscal deficit but in reduced level of per capita expenditures. The implication is that the delivery of basic services is adversely affected.

CLGU expenditure behavior: Unexpected outcome

It therefore becomes not merely a fiscal problem but a shortage and deterioration of urban service delivery, especially in health care and education.

Greater population means greater demand for public services. The same relationship applies to urbanization and its effects. Per capita personal income tends to rise in urbanized areas and this leads to increased demand for public services. However, the results of the regression analysis done by Manasan et al. using data on Philippine LGU expenditures show that in 1995, the degree of urbanization and per capita LGU expenditure (PCLGUEXP) were negatively and significantly related. For the other years, except in 1994, while the urbanization coefficient turned out to be positive, it was not significant. When the regression analysis was further extended to look into the effects of urbanization and population growth on the PCLGUEXP for health and education, the results showed that except in 1991, the association had been negative and statistically significant. This outcome is contrary to initial expecta-

Recommendations: Interventions to close the urban fiscal gap The urban fiscal gap can be closed in four ways: k Increasing local revenue effort with unchanged revenue authority; k Increasing LGU taxing authority; k Increasing transfers from central government; and k More efficient use of existing financial resources in service delivery.

Increasing local revenue effort In order to discourage LGUs from treating the IRA as a primary source of local revenue, tax effort may be taken into account in the IRA distribution formula. Alternatively, the IRA distribution formula may consider the allocation to the different LGUs on

"Greater population means greater demand for public services. The same relationship applies to urbanization and its effects." tions and to what have been obtained in other countries.

the basis of equalization of net fiscal capacities.

The unfortunate consequence

To address the problem of CLGU real property tax systems not fully capturing the rise in urban land values, the Local Government Code should be amended to automatically index the schedule of fair market value between general revisions. This should protect the real property tax base from infla-

What this all means is that instead of the actual CLGU per capita expenditure increasing, specifically for health and education services, it even declined as population growth rates and the degree of urbanization rose. Consequently, the fiscal gap is not reflected

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tion during the years when no general revision is undertaken. It will also narrow the gap between the official schedule of fair market values and the true market values of real property in the medium term. Moreover, to avoid the tendency of local assessors to value real property below its true market value, the use of zonal values (on which the Bureau of Internal Revenue (BIR) bases its assessment of transfer taxes) of real property should be considered. Collection should also be intensified. Aggressive collection and consistent issuance of notices for delinquent accounts should be made. For local business taxes, underreporting of gross receipts by establishments can be checked by requiring taxpayers to submit their income tax returns (ITRs) filed with the BIR. This way, local business tax can be initially assessed using the previous ITR and adjusted later when the current ITR becomes available. Local treasurers may also require large establishments to submit supplementary accounting records. In large urban areas, local treasurers should also be trained to check the veracity of reported gross receipts. To improve collection and enforcement of nonreal property taxes, the following may be considered: k Establish a roll for each type of tax (conduct a tax census and develop a revenue data bank). k Maintain systematic records where tax payments are automatically entered as they occur. k Send tax bills and monitor tax payments and delinquencies. k Strictly implement sanctions and penalties on errant taxpayers. To improve the poor financial performance of CLGU business enter-

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DEVELOPMENT RESEARCH NEWS

Strengthening APEC in the Light of the Asian Crisis

he third annual symposiummeeting of the Philippine APEC Study Center Network (PASCN) held in December 1998 focused on the recent financial crisis as it bears on the direction and future of the Asia-Pacific Economic Cooperation (APEC). The meeting was attended by representatives of the various member-institutions of the PASCN throughout the country.

Dr. Gloria O. Pasadilla (Assistant Professor, School of Economics, University of Asia and the Pacific), Dr. Juan Miguel M. Luz (Programs Manager of the Washington Sycip Policy Forum, Asian Institute of Management), Dr. Myrna S. Austria (Senior Research Fellow, PIDS), Dr. Leonardo A. Lanzona and Ms. Marissa M. P. Macam (Faculty Members, Department of Economics, Ateneo de Manila University).

The PASCN was established by virtue of Administrative Order No. 303 issued by then Philippine President Fidel V. Ramos in 1996. The network, composed of eight universities and two research institutions, has since been utilized by the government in its bid to enlarge and deepen its perspective on various issues that are, at present, part of the APEC agenda. Moreover, the Network promotes APEC-related studies and programs for both scholars and students.

Fr. Bienvenido Nebres, Jr., Ateneo University president, welcomed the participants to the two-day activity while Ambassador Antonio Basilio, president and chief executive officer of the Philippine Foundation for Global Concerns and executive director of the Philippine chapter of the Pacific Economic Cooperation Council (PECC), shared some insights on APEC and the PECC after the Kuala Lumpur summit in 1998.

The December 1998 affair saw the presence of a number of experts who presented papers on economic and technical cooperation and social issues, trade and investment facilitation and liberalization, and other general issues on APEC especially as they relate with the Asian crisis. The paper presentors included Dr. Cayetano W. Paderanga, Jr. (Monetary Board Member, Bangko Sentral ng Pilipinas), Dr. Angelo Unite and Dr. Wilfrido Villacorta (Research Fellow and President, Yuchengco Center for East Asia, De La Salle University, respectively), Dr. Fernando T. Aldaba (Executive Director, Social Policy and Public Affairs, Ateneo de Manila University),

The symposium-meeting was divided into four sessions, each tackling

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a specific concern. In the first session focusing on the relation between the Asian financial crisis and the APEC, Dr. Paderanga commented that the Asian crisis has put to question the evolving economic integration of APEC countries. A serious reassessment on whether to continue or not will have to consider the extent and direction of the integration. He said that the gains would include greater productivity, more choices, faster growth, more security and even more equity (if properly managed). He added that transition programs and safety nets must be discussed openly to avoid the negative effects. During the second session dealing with economic and technical cooperation (ecotech) and social issues, Dr. Unite and Dr. Villacorta posed the question: Can ecotech alleviate the effects of the Asian financial crisis? In the 1998 Kuala Lumpur Summit, APEC economic leaders reaffirmed the importance of ecotech activities to “strengthen economic fundamentals” in order to address the financial crisis. The priority areas under the ecotech pillar are human resources development, technological upgrading, infrastructure improvements and wider outreach to small- and medium-scale enterprises (SMEs). In response, Dr. Unite and Dr. Villacorta recommended that less developed countries must promote the private sector as catalyst for financing developmental projects in order for these countries to “graduate” from the status of a foreign aid recipient to an integral participant in the world market. Meanwhile, Dr. Fernando Aldaba observed that APEC members from Asia are keenly interested in promoting ecotech as an important pillar of APEC. This presents a shift from the initial thrust of trade liberalization. The

Dr. Cayetano Paderanga, Jr.

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he recent financial crisis in Asia proved one thing: Countries are interdependent on one another. What difficulty or blessing one country is experiencing may be felt by its neighbors sooner or later. This so-called contagion effect had put pressure on other Asian countries when the Thai baht depreciated or when the Korean economy buckled. The vulnerability of each country to be exposed to the same risk factors and to experience the same disastrous effects gives credence to the necessity of having one solid and working accounting framework. Such a framework that is able to map production patterns and income distribution, consumption needs and poverty, and economic requirements for growth and available natural resources and envi-

In December 1998, a two-week course entitled “Accounting for Sustainable Economic and Social Development (ASESD)” which dealt on the operation of the SNA framework and the development of accounting techniques for policy analysis was done at the ACCEED Conference Center of the Asian Institute of Managment (AIM) in Makati City. The course was an initiative of the Institute of Social Studies (ISS) based in The Netherlands and sponsored by The Netherlands’ Ministry of Development Cooperation. Its conduct and organization was held in collaboration with its Philippine counterpart, the Philippine Institute for Development Studies (PIDS), which also provided most of the resource speakers for the various modules.

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isting knowledge in accounting techniques of the participants and prepare them for the future implementation of the revised SNA. Basically, the course aimed to benefit researchers in development policy; practitioners in the design of social, economic and environmental policies; and statisticians and economists specializing in the field of national accounting and social and environmental statistics. The following subjects were included in the two-week course: k application of World Accounting Matrices for the analysis of global and regional trade and financial linkages; k updated national accounting methods grounded in the revised SNA

ASESD: A Training for Researchers and Practitioners ronmental constraints will be able to help economic managers in monitoring financial and trade flows. This will allow them to assess their economic positions and know which policy options to take. The new System of National Accounts (SNA) considers all these aspects and more. The new integrated accounting framework that will be adopted in the coming years also incorporates a set of human development indicators or a system of social indicators and the environment. The new SNA as revised in 1993 has been developed to respond to future changes in the accounting frameworks currently used in a number of countries. Thus, a worldwide training has been set up to prepare users to adopt to the new system.

Among the lecturers/resource persons were Dr. Rob Vos, Dr. Jan van Heemst and Mr. Jorge Alarcon of the ISS, Dr. Mario Lamberte, acting president of PIDS, Dr. Cayetano Paderanga and Mr. Diwa Guinigundo of the Bangko Sentral ng Pilipinas, Dr. Celia Reyes, Dr. Caesar Cororaton and Dr. Josef Yap of PIDS. As to the participants, majority were graduates of the ISS, coming from different countries in the region as well as practitioners from local institutes such as the PIDS and other local economic agencies like the National Economic and Development Authority (NEDA), the National Satistics Office (NSO) and the National Statistical Coordination Board (NSCB). The courses were specifically designed to enhance and refresh the ex-

of 1993 for macroeconomic policy analysis; k concepts and applications of Social Accounting Matrices (SAM), providing macroeconomic consistency to the links between labor market conditions, income distribution, consumption patterns and poverty; k extensions of the SAM framework to incorporate indicators of human development and of environmental degradation and natural resource endowments; and k applications of the accounting methods for social and economic policy analysis through Computable General Equilibrium Models. DRN

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Trade-related Aspects... From page 1

The mutually-agreed upon trade provisions among these contracting parties are the product of eight rounds of negotiations, starting with the Geneva Round in 1947 and culminating in the 8 th final round—the Uruguay Round—in 1986. Of the eight rounds of negotiations, the GATT Uruguay Round is considered the longest—lasting almost eight years from 1986 in Porta del Este, Uruguay to 1994 in Marrakesh, Morocco—and the most successful international trade negotiation of all time.1 Before the Uruguay Round, most trade negotiations were on goods. The Uruguay Round covered the nontraditional areas of agriculture, services, trade in counterfeit goods and trade-related aspects of intellectual property rights (TRIPS), and trade in investments and high technology goods. On January 1, 1995, the 128 contracting governments decreed themselves to be formally organized as the World Trade Organization (WTO). The GATT Uruguay Round results became the embodiment of the WTO. The WTO Agreement contained some 29 individual texts covering almost every tradable thing, from agriculture to textiles, from services to government procurement, and from rules of origin to intellectual property. 2 In addition to

these were more than 25 ministerial declarations, decisions and agreements which stipulate further obligations and commitments for WTO member states. Underlying all these trade rules and obligations were the principles governing all trade relations among WTO member states which include:3 One, nondiscrimination which is enshrined in the “most-favored nation” (MFN) clause binding members to grant the same treatment accorded to the product of one member to those of all the other members. There is also the “national treatment” provision which stipulates that trade privileges given by a member state to its own nationals must be similarly extended to foreign nationals of all other member countries of the WTO. Two, market access which avoids outright protectionism by establishing secure and predictable market access through the use of tariffs or customs duties. Quotas are now outlawed in WTO member countries. Instead, tariffs are just being allowed to promote domestic industries in order to raise revenues. These allowable tariffs, however, are largely “bound,” i.e., a tariff level for a particular product becomes a commitment by a WTO member and cannot be increased without compensation in negotiations with its main trading partner. Three, fair competition which may

———————— 1 The first five rounds of GATT dealt primarily on tariffs on goods. Starting with the sixth or the Kennedy round of negotiations, nontariff trade restrictions and the problem of trade in agricultural products were tackled. This trend continued and culminated in the Uruguay Round in 1986, which brought into GATT agriculture and textile, agreements on services (GATS), intellectual property rights (TRIPS), trade-related investment measures (TRIMS), and the creation of the World Trade Organization (WTO). The Uruguay Round took more than four years to prepare and was participated in by more than a hundred sovereign states. It resulted in 26,000 documents weighing 200 kilos of agreements and provisions meant to overhaul the world trading system and to create a more open world market. 2 Rufus B. Rodriguez, The GATT and WTO: An Introduction, Dean’s Publishing Co., Inc., 1998. 3 Ibid, pp.73-79. 4 Ibid, p. 77.

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be drawn from the WTO’s “system of rules dedicated to open, fair and undistorted cooperation.”4 This should clarify the notion that the WTO is a “free trade” entity. It is not, since it allows the imposition of tariffs and, to a certain extent, other forms of protection in some cases. What it simply promotes is fair competition. Four, reciprocity where WTO agreements are based on a balance of rights and obligations, attained through a reciprocal exchange of market-access commitments. Thus, trade liberalization among member countries occurs on a negotiated, quid pro quo basis to minimize free-riding. Five and last, promotion of development and economic reforms which is contained in two previous GATT measures that were adopted by the WTO. The measures enjoin k industrial countries to assist developing nation members “as a matter of conscious and purposeful effort” in their trading conditions, and not to expect reciprocity for concessions made to developing countries; and k the observance of an “enabling clause” which provides a permanent legal basis for the market access concession made by developed to developing countries under the generalized system of preferences (GSP).

Expected outcomes of GATT and WTO After four years of existence, the WTO has elicited mixed reactions worldwide. The more optimistic predict that the WTO agreements shall result in an increase in world trade by $745 billion annually, and that world income will rise by $230 billion. The Organization for Economic Cooperation and Development (OECD) estimates that if developing countries joined in the trade

DEVELOPMENT RESEARCH NEWS

liberalization effort, their annual income would rise by $86.4 billion. World trade is expected to expand by an average of 12 percent or an increase of $745 billion by year 2005.5 In the Philippines, both the Department of Trade and Industry (DTI) and the Department of Agriculture (DA) predict agribusiness exports to increase by P11 billion. It is also estimated that a P60 billion6 increase in agricultural gross value added (GVA) will be generated yearly, and that about 500,000 new jobs, accounting for almost half of the annual job requirement of the Philippines, will be created each year due to GATT-industrial expansion in agribusiness activities. On the other hand, the possibility of dislocation due to the swamping of cheaper agriculture products in their respective countries has been a common fear among farmers in various parts of the world. Such fear has given rise to the occurrence of many riots caused mostly by farmers and their supporters in countries like France and South Korea. In the Philippines, certain militant peasant groups have also voiced their concerns about the WTO agreements.7

All about TRIPS (Trade-related Aspects of Intellectual Property Rights) A key feature in the Uruguay Round is the TRIPS which incorporates provisions of previous treaties dealing with intellectual property rights or IPR. Apparently, gross violations of IPR

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"...The TRIPS accord assures “that an inventor, writer, performer, or developer of a creative work has a right to the financial gains that arise from his or her work." translating to billions of dollars annually prompted the member states to include it in the trade negotiations. Although piracy of intellectual property is widespread in both industrial and developing countries, the Washington-based Intellectual Property Alliance (IPA) reports that more than 75 percent of piracy is found in developing countries and in newly-industrializing countries in Asia. Publishers and distributors of computer software worldwide lose $12 billion annually due to software piracy. Still, this may be considered small in comparison to the losses in other industries (electronic, chemical, scientific, industrial and cultural products such as sound recordings, movies, photographic materials). For instance, in the film industry alone as reported by American movie studios, the loss is already about $2 billion annually. In the Philippines, losses from film piracy are placed at $22 million yearly. 8 Basically, the TRIPS accord assures “that an inventor, writer, performer, or developer of a creative work has a right to the financial gains that arise from his or her work. This includes the exclusive legal rights to control who uses the invention or artistic creation."9

———————— 5 Philexport, The World According to GATT: Selected Readings, p.5. 6 One US$ = P39.00 as of March 1999. 7 Op. cit. 8 Ibid. 9 Ibid. 10 Geographical indications are “indications which identify a food as originating in the territory of a Member, or a region or locality in that territory, where a given quality, reputation or other characteristic of the good is essentially attributable to its geographical origin” e.g., champagne, sake, Kobe beef. 11 Annex IC, WIPO Agreement, 1995.

TRIPS contains 73 articles which govern the use, trade, and protection of eight intellectual property rights: k copyright and related rights, k trademarks, k geographical indications,10 k industrial designs, k patents, k lay-out designs (topographics) of integrated circuits, k protection of undisclosed information (or trade secrets), and k control of anti-competitive practices in contractual licenses.11

Copyrights TRIPS provides protection to all substantive trade-related protections under the Berne Convention for the Protection of Literary and Artistic Works, further adding that computer programs, whether in source or object code, in compilations of data or other material, and in machine readable or other form, shall be protected as literary works. Duration of protection is the author’s lifetime plus 50 years. This includes translation rights, reproduction, public performance, broadcasting, adaptation and arrangement, and rental (so-called “neighboring” or related rights).

Patents The TRIPS accord considers as patentable all new and useful product and process inventions in all fields of technology, including pharmaceuticals and other chemicals. It allows exclusion from patent protection, if presenting a product’s commercial exploitation “is necessary to protect public order or morality, protect human, animal or

DEVELOPMENT RESEARCH NEWS

Trade-related Aspects... From page 7

plant life, or health or to avoid endangering the environment." Also excluded from patentability are diagnostic, therapeutic and surgical methods for the treatment of humans or animals; plants and animals other than microorganisms, and the establishment of biological processes for producing fruits and animals other than nonbiological and microbiological processes.12

Trademarks A trademark is a sign or any combination of signs capable of distinguishing the goods or services of one entity from those of another.13 Registered trademarks are protected for no less than 7 years, subject to indefinite renewals for terms not less than seven years. Registration may be canceled only after an uninterrupted three years of nonuse.

Layout design of integrated circuit Layout designs or topographics are protected from 10 to 15 years.

Undisclosed information For the first time under the TRIPS agreement, countries are required to protect trade secrets against third party acquisitions as long as the confidential information has commercial value, and reasonable steps have been taken to keep it secret.

Geographical indications TRIPS forbids countries from using geographical indications to identify wines and spirits which do not originate in the place or location indicated by the geographical indication in question.

Control of anti-competitive practices in contractual licenses The TRIPS accord discourages some licensing practices or conditions pertaining to intellectual property rights which restrain competition, may have adverse effects on trade, and impede the transfer and dissemination of technology. 14

Enforcement TRIPS requires member countries “to allow customs officials to delay the release of imports suspected of violating the accord. Border measures are mandatory with respect to counterfeit trademark and pirated copyrighted goods, and may apply, if certain conditions are met, to infringement of industrial designs, patents, integrated circuits and trade secrets. Countries must also provide criminal procedures for trademark and copyright piracy.”15

Aggravating circumstances: the emergence of the internet and other technological advances The inclusion of TRIPS in the Uruguay Round was largely pushed by the industrialized nations, particularly the United States, in the face of rapid developments in high technologies like digital technology in the past decade. The linking of trade and intellectual property standards ranks as the central conceptual advance in the TRIPS, according to some scholars.16

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These measures in pursuit of IPR made by the TRIPS Agreement, however, may arguably be in danger of becoming outdated and irrelevant because of rapid developments in digital technology, the convergence of IT and communications, and the information superhighway. Thus, one question being raised is whether or not a new paradigm of copyright protection is needed if the interests of creators and investors are to be adequately safeguarded.17 As a response to this, some point out the statements in the preamble of the 1966 WIPO Copyright Treaty which recognized “the profound impact of the development and convergence of information and communication technologies on the creation and use of literary and artistic works . . . and the need to maintain a balance between the rights of authors and the larger public interest, particularly education, research, and access to information as reflected in the Berne Convention," (underscoring supplied). Relatedly, many WTO member countries had to hasten the formulation of appropriate laws that would be responsive to new and emerging cyberspace technologies. The Philippines is not exempt from the phenomenal growth of the new communication technology. In his paper on e-commerce, Esguerra describes how the use of the internet and cable TV in the Philippines had spread rapidly in the 1990s,18 making the issue of IPR even more significant.

———————— 12 Philexport, loc. cit. 13 Ibid. 14 Philexport, loc. cit. 15 Ibid. 16 Sam Ricketson, “The Future of the Traditional Intellectual Property Conventions in the Brave New World of Trade-Related Intellectual Property Rights” in International Review of Industrial Property and Copyright Laws, Vol. 26, No. 6, 1995, p. 883. 17 Ibid, p. 898. 18 Joseph Jennifer M. Esguerra, “Electronic Commerce Status in the Philippines.” A country report presented at the Asia Pacific Economic Cooperation (APEC) Forum on Human Resource Developments in Industrial Technology, University of Wollongong, Australia, October 1-3, 1998.

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March - April 1999

The 1996 World Intellectual Property Organization (WIPO) Digital Conference19

WTO as compared to GATT What differentiates the WTO from the GATT? Below is a list which shows that the WTO is not a mere extension of the former. Areas

GATT

WTO

Nature of entity

A multilateral agreement on a set of rules without institutional foundation

A permanent institution with its own secretariat in Geneva

Basis of commitments

Provisional

Full and permanent

Coverage

Mostly covers trade in goods

Includes nongoods such as services and TRIPS

Extent of commitment to members

Plurilateral and selective in nature

Multilateral and involves entire membership

Dispute settlement mechanisms

Susceptible to blockages

Faster, more automatic and less susceptible to blockages

According to Esguerra, there were approximately 82 million internet users worldwide at the end of 1997. This number is expected to reach the 330 million level in the next five years, thereby growing annually at a compounded rate of 38 percent (as per the International Data Corporation projection). The Asia-Pacific internet users comprise 10 percent of the current number of worldwide users, with the Philippines representing a mere 2.5 percent of the total Asia-Pacific users or an estimated total of 217,121 users as of the end of last year. However, within the next 5 years, it is expected that the Philippines will be able to catch up with the worldwide growth rate, notwithstanding the fact that the recent East Asian crisis affected its growth. Of the total number of Filipino internet users, about 75 percent have access to the World Wide Web. This figure is expected to steadily increase up to 95 percent in five years. Of those with web access, it is estimated that only about 6 percent buy products through the web. Filipinos are optimistic, though, that the number will rise to 30

percent by 2002 as web users become more comfortable in transacting business over the internet. The growth of the internet and cable TV in the Philippines has been phenomenal. In 1994, there was only one internet service provider (ISP) whose operation was largely subsidized by generous funding from the government’s Department of Science and Technology (DOST). Today, the country has 205 private ISPs, with more than half operating in the provinces. Meanwhile, in terms of cable TV, the country did not have a single company before the 1990s. Today, there are 104 cable TV companies, providing worldwide news and entertainment to most of the country’s municipalities, except in the remotest areas and small island communities where electricity is still unavailable.

———————— 19 Information regarding the WIPO Digital Conference were based on the notes of Ma. Rowena R. Gonzales for an article published in The World Bulletin, Vol. 13, Nos. 3-4, 1997, University of the Philippines Law Center, pp. 96-126.

The global and borderless nature of the internet, while promising countless benefits for the free flow and exchange of knowledge, has nonetheless presented a most vexing dilemma. Governments, although eager to allow optimal use of the information highway for socioeconomic growth, are aware of the need to deter its use for negative purposes such as IPR piracy, pornography, cults, racial hatred, and gambling. The emergence of cyberspacebased technologies has thus challenged our traditional political and legal concepts of territoriality, nationality, ownership and jurisdiction. Considering that WIPO and WTO treaties on IPR were forged prior to the full onset of the internet and cyberspace technology, the WIPO convened a Diplomatic Conference on Certain Copyright and Neighboring Rights Questions (referred to as the digital conference) on December 2-20, 1996 in Geneva to review and/or add more provisions to the TRIPS Agreement as well as to the Berne and Rome Conventions on IPR in the context of the new digital environment.

Agreements in the WIPO digital conference Under the new WIPO Copyright Treaty, authors have been granted the following: k right of distribution, k right of rental, and k right of communication to the public. Under the Performances Treaty, performers are guaranteed the following: k moral rights, k economic rights in their unfixed performances,

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Trade-related Aspects... From page 9

k right of reproduction, k right of distribution, k right of rental, k right of making available fixed performances, and k right to remuneration for broadcasting and communication to the public. “Similar rights have been granted to producers of phonograms, to wit: k right of reproduction, k right of distribution, k right of rental, k right of making available phonograms, and k right of remuneration for broadcasting and communication to the public.”

Contentious issues in the WIPO digital conference Perhaps the most important and contentious issue discussed in the 1996 digital conference was the right of communication to the public. This right, along with those granted to performers and phonogram producers, was considered by many delegates as the cornerstone of the digital agenda.20 While the right of communication to the public was previously included in the Berne Convention, the 1996 digital conference proposed to expand its scope such that authors of literary and artistic works “shall enjoy

"Long before WTO and TRIPS, the Philippines has recognized the importance of intellectual property protection in industry and trade."

the exclusive right of authorizing any communication to the public of their works, by wire or wireless means, including the making available to the public of their works in such a way that (the) numbers of the public (who) may access these works from a place and a time individually chosen by them.”21 The Global Information Infrastructure (GII), claimed to be the backbone of the internet, and the International Federation of Library Associations (IFLA) both criticized and expressed strong reservations about this proposal. In a position paper submitted by one of its members, the GII noted that the proposed exclusive right of communication to the public would impose a form of subsidiary liability on its members as gatekeepers of the internet. This in turn would seriously jeopardize trade, including the low-cost lawful distribution of intellectual property. On the part of the IFLA, meanwhile, it cited the public role of librarians as “responsible intermediaries between right owners and end-users” and as “catalysts for the flow of information in a community.” Therefore, the benefits of the new information technologies should be made available to all. Information should be accessible regardless of the format and “the lending of published electronic resources by libraries for cultural and educational purposes should not be restricted by legislation.22 The question of audio-visual fixation of literary and artistic works was another strong issue tackled in the 1996 WIPO digital conference. Despite tremendous gains attained during the digital age, international protection of performers has been confined to audio-visual fixations of their performances, i.e., phonograms. Thus, reproduction of copyright works in audio-visual fixation (e.g., VHS tapes, CD-

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ROMS, DVDs) is excluded from the copyright protection of authors. As noted in the 1996 WIPO Diplomatic Conference, the all-pervasive influence of new and rapidly-increasing technologies is becoming increasingly apparent in many spheres of international and national life. Various stakeholders and key players in the conference—publishers, authors, technical service providers, software industry, broadcast organizations and phonogram producers—have raised issues and concerns for which little or no norms or precedent exist. Thus, debates for IPR and other WTO and WIPO related matters are likely to persist and increase in the 21st century.

IPR: The Philippine experience Long before WTO and TRIPS, the Philippines has recognized the importance of intellectual property protection in industry and trade. As early as June 20, 1947—or barely a year after being granted autonomy by the United States—the Philippines enacted Republic Acts (RA) 165 and 166, more commonly known as the Patent Law and the Trademark Law, respectively. Besides its domestic laws on protecting intellectual property, the Philippines also appreciates the importance of intellectual property protection in international trade and industry. The country is signatory to various international conventions and treaties on IPR. On copyright, the Philippines acceded to the 1951 Berne Convention for the Protection of Literary and Artistic Works. In that same year, it was signatory to the Budapest Treaty on the International Recognition of the Agreement of Microorganization for the Purpose of Patent Procedure. In ———————— 20 Ibid, p. 116. 21 Gonzales, op. cit. 22 Ibid.

DEVELOPMENT RESEARCH NEWS

1984, it also became party to the signing of the Rome International Convention for the Protection of Performers, Producers of Phonograms and Broadcasting Organizations. As such, it would be accurate to say that in the ASEAN region, the Philippines was among the first to have a comprehensive section on intellectual property rights preferentials. When the Philippines joined the WTO, it became duty-bound to realign all its existing laws to make them TRIPS-compliant on or before the year 2000. Under the Ramos administration, Congress passed R.A. 8293 or the Intellectual Property Code of the Philippines which took effect on January 1, 1998. This omnibus IPR law amended and repealed all previous legislation on IPR, including the following: R.A. 165 - the Patent Law of the Philippines R.A. 166 - Trademark Law of the Philippines Presidential Decree (P.D.) 49 Law on literary and artistic works, including computer programs, as provided for in the Berne Treaty. P.D. 285 - National Reprinting Law P.D. 1203 - Amending P.D. 285 and allowing for the reprinting of foreign textbooks and reference books, if these materials exceed $10 a piece, under certain conditions. Barely a year ago, before the enactment of RA 8293, there was rampant pirating of computer software and film piracy, both local and foreign, in the country. Although the practice has not

been totally checked, the existence of the law certainly acts as a deterrent. The Philippines is not yet a party to the Treaty on Intellectual Property in Respect of Integrated Circuits nor to the Union for the Protection of Plant Varieties. However, the Department of Trade and Industry had already submitted two draft bills on integrated circuits and protection of plant varieties to the current Congress.23

Opposition to the Philippines’ accession to WTO and TRIPS Although the Philippines has been signatory to a number of international trade agreements in the past, its accession to the WTO was nonetheless initially opposed. Before the Supreme Court, oppositors challenged the legality and constitutionality of the country’s membership in the WTO, averring that such an act of the Philippine government could undermine economic nationalism and was detrimental to the nation’s sovereignty, interest and security. In dismissing the complaint, the Supreme Court explained that “Respondents (i.e., Philippine Senate) maintain that the WTO itself has some built-in advantages to protect work and developing economics, which comprise the vast majority of its workers. Unlike in the UN where major states have permanent seats and veto powers in the security council, decisions in the WTO are made on the basis of sovereign equality, with each member’s vote equal in weight to that of any other. There is no WTO equivalent of the UN Security Council.24

———————— 23 Author’s interview with Ms. Emma Francisco, Director General of the Intellectual Property Office, Department of Trade and Industry, February 1999. 24 G.R. No. 118-295, Wigberto E. Tañada, Anna Dominique Coseteng, et al. vs. Edgardo Angara, et al. of the Philippine Senate (Supreme Court decision dismissing the petition for the nullification of the Philippine ratification of the WTO Agenda). 25 Ibid.

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“There are at present about 31 countries, including China, Russia, and Saudi Arabia, negotiating for membership in the WTO. Notwithstanding objections against possible limitations on national sovereignty, the WTO remains as the only viable structure for multilateral trading and the veritable forum for the development of international trade law. The alternative to WTO is isolation, stagnation, if not economic selfdestruction…the Philippines now straddles the crossroads of an international strategy for economic prosperity and stability in the new millennium,” 25 (underscoring supplied).

Conclusion: Some suggestions Conceived by a small group of leading industrial countries called the International Trade Organization (ITO) in the late 1940s, the WTO was born in the 1990s as a truly international and precedent-setting trade and legal mechanism for promoting global economic growth and development. The WTO ushered in a new, uncharted era of stable and harmonious internal trade relations and became unwitting heir to the varied ramifications of unforeseen great advances in information technology such as the internet. And while the challenges posed by the internet continue to test the WTO’s stability, its response through the promulgation of the TRIPS proves its sensitiveness to emerging concerns. In the case of the Philippines, the following suggestions may result in greater benefits as it complies with the rules of being a developing membercountry of WTO:

1 All WTO member countries, whether developing or industrialized, will have to re-align existing laws or enact new ones to comply with TRIPS agreements, and other IPR-related treaties.

= 12

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Trade-related Aspects... From page 11

2 As with many laws, enforcement mechanisms will have to be put in place and tightened and strictly followed. 3 Sanctions against infringements or violations must be consistently applied and made severe enough to include stiff penalties and imprisonment so as to act as an effective deterrent. 4

To resuscitate the flagging economies of Southeast Asia and Latin America due to the Asian currency crisis, affected member states should exert extra effort to persuade WTO to relax rules on national treatment and most-favored-nation provisions.

5 Since they have the numbers to effect revisions in the WTO Agreement, member countries of Africa, Latin America, Asia and the Pacific must continue to strive for the inclusion of folklore patenting in the TRIPS agreement so as to protect heritage and cultural property such as relics, folk arts and medicine, anthropological and archeological artifacts, and other cultural/historical memorabilia. 6 WTO and WIPO, perhaps with ILO, UNESCO, UNDP or EEC support, should conduct an intensive information campaign in developing member countries for critical sectors or stakeholders such as policymakers, industry and business groups, opinion makers, the media, and police and customs authorities, to enlighten said sectors on the WTO and TRIPS provisions. ———————— 26 Ma. Rowena R. Gonzales, op. cit., 1997, p. 121.

WTO and WIPO might consider, with proper representation of developing member countries, the possibility of relaxing or exempting from the more restrictive functions of TRIPS all member countries who fall below a certain world poverty line so as to promote education and research in developing countries.

8 Besides the usual monitoring exercise prescribed in the WTO and TRIPS agreement, WTO and WIPO should encourage and suggest a periodic or regular international conference of selected member countries not only to exchange ideas and experiences on compliance or noncompliance to TRIPS but also to generate new ideas or provisions to further enrich TRIPS, especially with the rapidly-enfolding developments of new technologies in this digital information age. Finally, the need to regularly exchange information among peoples and countries cannot be overemphasized. As Ms. Gonzales said in her article: “The ease of access to information has dramatically increased the learning possibilities and capabilities of peoples. However, it has also magnified the corresponding uncertainties and contradictions of the Age as there is less and less of a beaten path to follow, and governments around the world, almost simultaneously, are called upon to address together problems on a global basis. Many local problems will remain and possibly increase, but they will take on a more international character. Indeed, a paradox for this Age will be that the local will become more global and the global will become more local. Centralized authority in every country will become less central to people’s lives as people start to organize ‘around ideas and cultural orientations rather than around geographical entities.’ More and more, the paradigm of a ‘north-

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south’ relationship will pass to a bygone age and will be looked at differently, perhaps with nostalgia, relief, or anger. Or plain indifference. In the context of a global village, the future lies in finding the balance between individual rights and the public interest.”26 DRN

Vol. XVII No. 2

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Editorial Board Dr. Ponciano S. Intal, Jr. President (on leave) Dr. Mario B. Lamberte Vice-President and Acting President Mr. Mario C. Feranil Director for Project Services and Development and Acting Vice-President Ms. Jennifer P.T. Liguton Director for Research Information Ms. Andrea S. Agcaoili Director for Operations and Finance Atty. Roque A. Sorioso Legal Consultant

Staff Jennifer P.T. Liguton Editor-in-Chief Barbara F. Gualvez and Genna J. Estrabon Issue Editors Liza P. Sonico, Corazon P. Desuasido Joel C. Cruz, and Edwin S. Martin Contributing Editors Valentina V. Tolentino and Rossana P. Cleofas Exchange Delia S. Romero, Galicano A. Godes Necita Z. Aquino, Lilet L. Lamayo and Federico D. Ulzame Circulation and Subscription Jane C. Alcantara Lay-out and Design

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Urban Fiscal Gap... From page 3

prises, cost-based pricing may be considered. Another is to set up management contracts with the private sector.

Increasing LGU taxing authority For starters, the assignment of taxing powers to various levels of government should be reviewed. Residence-based taxes and taxes on immobile factors such as real property tax are appropriate for local taxation. So is motor vehicle tax. Betterment levies may also be explored as these have had positive effects in Korea and Colombia. These levies are meant to recoup the public costs of providing urban infrastructure from the beneficiaries.

Improving efficiency and effectiveness in service delivery There is ample evidence to show that even with insufficient funds, LGUs can greatly improve service delivery. These have been proven in the experiences of selected Philippine cities which shifted strategy and innovated,

Editor's Notes From page 1 and other violations that amount to billions of dollars annually in terms of lost revenue. What does this imply for the Philippines, being a member of the WTO and dutybound to adhere to its rules? This is the major concept discussed in the lead article for this DRN issue as based on a speech delivered recently by Director Jose Guerrero of the Philippine Department of Science and Technology. On a more domestic issue, we discuss the matter of urban fiscal gap in Philippine

resulting in a more efficient public service delivery. Three common factors may be drawn from their examples, to wit: One, there is greater participation of stakeholders in the implementation process and funding. For example, Surigao City and Lapu-Lapu City mobilized their women’s groups to deliver health services. Naga City asked community organizations to identify and come up with the financial counterpart of housing program beneficiaries while Puerto Princesa’s residents participated in cleanliness and reforestation programs. Two, LGUs in best practice cases took different routes in addressing the fiscal gap. Olongapo City introduced user fees while San Carlos City set up well-planned cost recovery schemes. Others found ways to reduce the cost of service production and delivery. Cotabato City used barangay halls and private homes in the absence of barangay health stations. Still others tapped additional funds from higher levels of government and the private sector. Olongapo City required its barangays to allocate five percent of cities on page 2. This study by Dr. Rosario Manasan, PIDS Senior Research Fellow, poses certain challenges and suggestions to policymakers, especially those in the local governments, related to how to close such gap in order to enhance their financing and delivery of basic urban services to their constituents. On page 4, meanwhile, is a feature on the annual symposium of the Philippine APEC Study Center Network (PASCN) held last December 1998. The meeting was attended by a number of experts who presented and discussed various concerns like economic and technical cooperation, trade and investment facilitation and liberalization, and economic integration among APEC member-economies in connection with the recent East Asian financial crisis.

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their IRA to health and welfare while Surigao City got P1.5 million for the construction of a training center from the Countrywide Development Fund of a senator. Three, laudable programs are integrated with other intersectoral programs. Puerto Princesa’s Low-Cost Housing Project, for instance, is one component of a wider program called Bantay Dagat program. Olongapo City strengthened the link between health and sanitation by integrating its environment program with health activities. Indeed, the seemingly complicated problem of urban fiscal gap can be overcome if only LGUs will exercise creativity, resourcefulness and diligence in the effort to serve their constituents. Laws may need to be passed in order to amend certain provisions that hamper the closure of the fiscal gap. But as some of the local governments in the country’s largest cities have shown, there are countless ways of accomplishing the task of efficiently delivering basic public services to the people even without much financial resources—if only the local leaders and the residents will look hard enough and work together. DRN We also report on page 5 the results of the training on “Accounting for Sustainable Economic and Social Development (ASESD)” sponsored jointly by the Institute of Social Studies (ISS) of The Netherlands and the PIDS. The course dealt with a new System of National Accounts (SNA), an integrated accounting framework that incorporates several economic and social indicators to help economic managers formulate policies that promote sustainable development. Finally, on page 14, we introduce the “Corporate News,” a new section beginning this issue which contains various activities (serious, work-related and just plain fun) involving PIDS personnel. The first articles featured here combine all three attributes. DRN

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The

CORPORATE NEWS

Beginning this issue, we are introducing the Corporate News section which will include brief accounts of inhouse PIDS activities and staff training and workshop results. The idea for the inclusion of this new section is to let our readers know what is happening inside the Institute. That behind the pages of the Institute’s various research outputs and analyses are stories about departmental staffs, work groups and individuals getting together to plan the next set of programs, striving to further improve their knowledge or skills through trainings, and/or interacting with one another to promote better teamwork. Most of the time, the stories focus on serious stuff. On certain occasions, though, they simply talk about the PIDS staff having fun. Whatever the topic is about, however, the objective is to show that they are meant to help the staff become better persons and performers in their respective fields so that they can contribute more to the attainment of the Institute’s overall mandate.

WIFM: Giving Better Presentations for Better Understanding

hat’s In it For Me? or WIFM—is usually the first question one asks oneself when invited or asked to attend a lecture or presentation or when intending to participate in a seminarworkshop and the like. Will I learn something? Is it worth my time? Will it clear my doubts? What do I gain from it? Each member of the audience has his own expectation depending on what he needs or wants. This is one cardinal rule to remember when one speaks or presents before an audience. Thus, such principle was constantly impressed by the Guthrie-Jensen facilitator on the senior research and management staff of the Institute during the two-day program on “Effective Presentation Skills” held in an out-of-town-venue. The Institute’s senior staff, especially the Research Fellows, are regularly invited by various groups to present the highlights of their research findings and recommendations as well as their insights and analyses on certain policy issues. Presentations, however, have to vary on the basis of who constitutes the audience, what the objectives are and what the format of the gathering is. At the same time, the Fellows, though experts in their respective areas of specialization, also need to hone their skills in giving presentations that are dovetailed to the audience that they are facing. In response to this need, therefore, the Institute organized this program with the help of the GuthrieJensen group. The two-day program placed equal emphasis on two things. One is the value of planning and preparation. The other is the polishing of the presentors’ platform skills.

On planning and preparation This aspect is a major concern among the Institute’s staff. With so much material on hand, what may be a useful guide to help in organizing all the available information to come up with a storyline and in focusing on the significant points, considering the limited time given for the actual presentation?

To be or not to be. Effective presentors, that is. The PIDS research and management teams learned from the best trainors. What else are those smiles for?

Audience analysis is, of course, a key tool. Always keep the audience in mind. As such, one must understand the audience’s prevailing attitudes on the particular topic, expectations and profile. Setting the objectives clearly, planning the approach for the delivery of the message and preparing the logistics like visual aids well in advance are also very important in helping the presentor be well-prepared and more confident.

On delivery and platform skills Various tips for helping the presentors to polish their delivery and platform skills were discussed in detail. Concerns regarding body language like gestures, appearances and movements; voice projection; pacing; establishing rapport with and sustaining the interest of the audience; and handling visuals were tackled at length. The process of enhancing one's presentation skills, though, does not and should not end with one seminar program. More reinforcement exercises and sessions should therefore follow to help sustain the skills learned so as to give better presentations for a better understanding of the issues being discussed. DRN

DEVELOPMENT RESEARCH NEWS

Supervision: A Challenge and a Commitment

four-day Supervisory Development Course for PIDS staff occupying supervisory positions was held on November 24-27, 1998 by the Civil Service Commission. During the course, participants were exposed to inspiring words of wisdom, valuable knowledge, and the challenges that are attendant to the supervisory role.

Planning for Wider and Better Dissemination: The RIS Workshop

the course, participants learned that a supervisor is a leader who TRANSFORMS. In mnemonics (which, according to the dictionary, is a technique of improving the efficiency of the memory), this means that a supervisor is a teambuilder, a risktaker, an arbitrator and assistant problem solver, a networker, a strategist and analyzer, a facilitator and originator of change, an organizer, a resource manager, a mentor/trainor, and a spokesperson. These roles help the supervisor in becoming an efficient and effective middleman between the rank-and-file and management. In short, a supervisor is expected to care for and be a challenge to his subordinates as well as communicate their concerns to the management of the organization. In their remarks during the closing ceremonies of the course, the participants expressed their gratitude for the muchneeded energy boost that the facilitators and activities were able to offer to them as public servants and for the constructive knowledge that were imparted to them. The participants vowed to put the lessons learned in the course into practice as they perform their respective supervisory roles in the Institute. DRN also recorded an average of once- or twice-a-week exposure or feature on the Institute’s outputs and activities in the various national dailies.

he members of the Institute’s Research Information Staff (RIS), whose tasks involve the dissemination and promotion of the use of PIDS research outputs by the various policymaking publics, gathered together for a two-day, out-of-the-office planning session to review their accomplishments for the previous year and to chart the direction of their various programs and activities for the incoming year.

In celebration of the Philippines' centennial anniversary of the declaration of its independence, the Institute also launched a series of lectures known as the PIDS Centennial Lecture Series where noted historians and writers were invited to give their analyses and insights on the significance of various events related to the country’s independence and their relevance in the making of present history.

Summing up the Institute’s outputs under its publications program in 1998, the RIS, in collaboration with the other PIDS departments, released a total of 66 various dissemination outlets which include three books, nine issues of the Journal of Philippine Development (JPD) and the Development Research News (DRN), 10 policy notes and 44 discussion papers. In terms of reaching out to its various audiences, the Institute continued with its effort to broaden the number of its recipients as it added decisionmakers and administrators in the local government level in its mailing list for publications.

Continuing from the work accomplished in 1998, the Institute’s information office outlined a set of programs and activities for 1999 which will either enhance the effectiveness of current programs or further broaden and deepen the reach of its studies. As the efforts to connect with its different publics were reviewed and refined in 1998, the Institute likewise began to set into place the launching in 1999 of schemes meant to make extensive use of the electronic media; relay key messages in customized formats specific to a particular audience or clientele; forge stronger and regular linkages with the legislative and executive branches and their technical staffs, and the media; and upgrade the PIDS library facilities and collection to make them more responsive to the needs of the new millennium.

For the Institute's public affairs program, 50 different types of fora meant to interact with various audiences like the top policymakers, technical staff, members of the academe, business groups and government representatives were held in 1998. All these were meant to communicate the key results and recommendations of the Institute’s research studies to its intended clientele. A regular media monitoring program of the Institute

Said programs all have this overriding objective: to reach more of the Institute's intended clientele in a more receiverfriendly format and timely fashion. DRN

CORPORAT E NEWS

"...A supervisor is expected to care for and be a challenge to his subordinates as well as communicate their concerns to the management of the organization."

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ehT

The course made use of the method of adult learning or andragogy wherein every staff is encouraged to be actively involved in the sharing of ideas and experiences. At the end of

DEVELOPMENT RESEARCH NEWS

Strengthening APEC... From page 4

strategy here, according to him, is for the state to forge partnerships and cooperation with the private sector and to involve the civil society to achieve sustainable human development. As to the social impact of the crisis, Dr. Gloria Pasadilla foresees economic stagnation over the next few years as a result of the crisis, leading into a worsening poverty incidence. Based on the results of her preliminary survey of the Philippine situation, she noted that the employment effect cuts across different income groups, with the middle-to-high-income groups in the formal sector being more prone to business closures and the urban poor sector affected both economically and psychologically by the job losses. A general increase in prices, particularly staple food, will further reduce the income of the poor. Higher unemployment and inflation will also have a longterm effect on the status of child nutrition and infant mortality rate.

In his presentation during the third session on trade and investment facilitation, meanwhile, Dr. Juan Miguel Luz declared that the financial turmoil has shaped the discussion within the APEC Business Advisory Council (ABAC) and has been the main concern of business sector leaders. The crisis revealed the importance of finance and the need to include a “new financial/economic architecture” in APEC’s agenda to ensure that, structure-wise, the same problems would not surface again or at least be identified at the earliest time and dealt with substantially before they could escalate into a crisis. Dr. Luz also said that the priority sectors of ABAC include ecotech (with the concept of “Partnership for Equitable Growth”) and SMEs. It has been recognized that the SMEs in the region have provided employment and income during the crisis. As such, the ABAC now proposes to further protect and expand the SMEs’ role as safety nets. During the last session on trade and investment liberalization, Dr. Myrna Austria stated that the present challenge for the APEC is how to package the Early Voluntary Sectoral Liber-

DEVELOPMENT RESEARCH NEWS is a bi-monthly publication of the PHILIPPINE INSTITUTE FOR DEVELOPMENT STUDIES (PIDS). It highlights the findings and recommendations of PIDS research projects and important policy issues discussed during PIDS seminars. PIDS is a nonstock, nonprofit government research institution engaged in long-term, policy-oriented research. This publication is part of the Institute's program to disseminate information to promote the use of research findings. The views and opinions expressed here are those of the authors and do not necessarily reflect those of the Institute. Inquiries regarding any of the studies contained in this publication, or any of the PIDS papers, as well as suggestions or comments are welcome. Please address all correspondence and inquiries to: Research Information Staff Philippine Institute for Development Studies Room 304, NEDA sa Makati Building, 106 Amorsolo Street, Legaspi Village, 1229 Makati City, Philippines Telephone numbers 892-4059 and 893-5705 Telefax numbers (632) 893-9589 and 816-1091 E-mail address: publications@pidsnet.pids.gov.ph Re-entered as second class mail at the Makati Central Post Office on April 27, 1987. Annual subscription rates are: P150.00 for local subscribers; and US$20.00 for foreign subscribers. All rates are inclusive of mailing and handling costs. Prices may change without prior notice.

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alization (EVSL) as an effective response to the economic crisis while pursuing its goal of advancing free trade and investment. The EVSL is an integrated approach to liberalization, incorporating the three pillars of APEC. There is, however, uncertainty now that APEC economies agreed to elevate the EVSL to the World Trade Organization (WTO). According to Dr. Austria, the strategy for APEC economies in the meantime is to commence the implementation of facilitation measures and ecotech projects which are both within APEC’s influence and control. Finally, Dr. Lanzona and Ms. Macam looked into the long-term prospects of the EVSL in the Philippine setting. They noted that despite the purported benefits that may be reaped from trade liberalization through the EVSL, there have been several hindrances encountered regarding its implementation. These include political factors, price distortions and the onset of the current regional financial crisis.They thus advised the Philippine government to implement domestic policies such as subsidy/tax instruments to minimize the cost of trade protection, unilateral trade reform to remove domestic price distortions and regional trade agreements where member-countries are asked to reduce distortions simultaneously. Among the invited commentators on the various papers presented were PIDS President (on leave) Dr. Ponciano S. Intal, Jr. and Director Jesus L. Motoomull of the Department of Trade and Industry. The session moderators, meanwhile, included Dr. Mario B. Lamberte, PIDS Acting President, Ms. Teresita Berner, Executive Director, Foreign Service Institute, Dr. Tereso S. Tullao, Jr., Professor, De La Salle University, and Dr. Germelino Bautista, Director, Institute of Philippine Culture, Ateneo de Manila University. DRN