Sep 192014
 

http://wikileaks.org/cable/2006/05/06MANILA2185.html#

Reference ID Created Released Classification Origin
06MANILA2185 2006-05-25 07:10 2011-08-30 01:44 UNCLASSIFIED Embassy Manila
VZCZCXRO7057
RR RUEHCHI RUEHDT RUEHHM
DE RUEHML #2185/01 1450710
ZNR UUUUU ZZH
R 250710Z MAY 06
FM AMEMBASSY MANILA
TO RUEHC/SECSTATE WASHDC 1136
INFO RUEHZS/ASEAN COLLECTIVE
UNCLAS SECTION 01 OF 02 MANILA 002185

SIPDIS

SIPDIS

STATE FOR EAP/MTS AND FOR EB/TPP/IPE CARRIE LACROSSE
STATE PASS TO USTR FOR BWEISEL AND DKATZ
STATE PASS USAID FOR CDOWNEY
USDOC FOR 4430/ITA/MAC/SBERLINGUETTE
USDOC PASS TO USPTO FOR PETER FOWLER
BANGKOK FOR CHRIS SONDERBY

E.O. 12958: N/A
TAGS: ECON ETRD EINV KIPR WTRO RP
SUBJECT: ASSISTANT USTR WEISEL’S MEETING WITH SENATOR ROXAS: PHARMACEUTICALS, WTO, INVESTMENT ISSUES

SENSITIVE BUT UNCLASSIFIED – NOT FOR INTERNET
DISTRIBUTION – PROTECT ACCORDINGLY

REF: STATE 65243

——-
SUMMARY
——-

¶1. (SBU) In a meeting with Assistant USTR for Asia
Pacific and Pharmaceutical Policy on May 16, Senator
Roxas agreed to work with the USG to address specific
concerns regarding Senate Bill 2139, which includes
provisions to expand parallel importation for
pharmaceuticals. On WTO Doha Round negotiations, Roxas
highlighted the GRP position which continues to be
resistance to further reduction of applied tariff rates
for non-agricultural market access (NAMA), as well as
the need to maintain protectionism for certain
agricultural products. With respect to legislation to
restore tax incentives to businesses in the Clark
Special Economic Zone, Roxas said that the Senate
unanimously agrees that the legislation should be
passed. The legislation is still in Committee, but may
emerge in a broader piece of legislation dealing with
other incentive issues, which could slow down its
passage. END SUMMARY.

———————–
ROXAS ON WTO DOHA ROUND
———————–

¶2. (SBU) AUSTR Weisel, accompanied by Econ Counselor,
Commercial Counselor, and Econoff, requested that
Senator Roxas, as Chair of the Senate Committees on
Economic Affairs and on Trade and Commerce, support
the US in the WTO Doha Round negotiations. Roxas said
that the GRP still has problems with the NAMA formula,
which requires more aggressive tariff cuts than the
Philippines is willing to make. Roxas argued that the
RP’s average applied tariff rates are low compared to
the rest of the region. “We are not getting any credit
for that. We are starting from a lower base with no
room to readjust.” Roxas said that the GRP also has
issues with the agricultural provisions since the RP
does have limited products that it wants to protect.
He cynically concluded that in the end, “We are
background noise. Chances are that we will end up
going along to get along and then suffer the
consequences.”

——————————————— —-
SENATE UNANIMOUS ON NEED FOR LEGISLATION ON CLARK
——————————————— —-

¶3. (SBU) On legislation to restore Clark tax
incentives, Roxas said that he knows that it is
sensitive for investors. Despite unanimous agreement
within the Senate to address the problem, members
disagree over how it should be done. The Chair of the
Ways and Means Committee, Senator Ralph Recto, wants to
incorporate language restoring Clark tax incentives
into a broader piece of legislation that addresses a
range of incentive issues, he said. As it stands, the
Senate is ready to pass legislation on Clark, but if it
gets linked to other incentive issues, Roxas predicted
that disagreements could slow it down. Roxas added
that the Senate can work on the legislation only after
it comes out of the Ways and Means Committee, so he
said he hoped that Recto will keep the Clark
legislation separate from other incentive proposals.

———————————-
ROXAS WILLING TO COMPLY WITH TRIPS
———————————-

¶4. (SBU) Weisel raised concerns about Senate Bill 2139
(SB2139), known as the “Roxas Bill,” which proposes to
amend the Intellectual Property Code of the Philippines
in order to expand the RP’s parallel importation
program for pharmaceuticals to include patented
medicines. Roxas said that he wrote the legislation in
order to make medicines more affordable to the average
Filipino. He said, “The real goal is to try and create
more competition in the domestic market. There are 85

MANILA 00002185 002 OF 002

million people here, but the actual purchasing power of
that population is much smaller.”

¶5. (SBU) Weisel suggested alternative means to address
the issue, including tariff and excise tax reductions
on pharmaceutical products. Roxas commented that this
was a “fair point” and that he “really appreciated the
exchange.” He said that he sees SB2139 as one way to
address the problem, but recognizes that there are
other things the GRP should be doing. Weisel said that
countermeasures for counterfeit medicines also deserve
attention as new policies and legislation are
considered.

¶6. (SBU) In response to the USG’s request for
clarification on certain provisions that pose possible
compliance issues with respect to Trade Related Aspects
of Intellectual Property Rights Agreement (TRIPs)
(reftel), Roxas said that the legislation has already
been reworked. The Intellectual Property Office (IPO)
recommended changes in order to ensure TRIPs
compliance, which have been accepted verbatim. Roxas
said that he would send the Embassy a copy of the
updated bill. He expressed interest in working with
the USG to resolve potential TRIPs issues.

——-
COMMENT
——-

¶7. (SBU) The meeting was positive and focused on
constructive ways to ensure that SB2139 is TRIPs
compliant. The draft legislation has met with
increasing support from local interest groups but harsh
criticism from the pharmaceutical industry. Being able
to raise TRIPs-related concerns about specific
provisions (reftel) contributed to the positive tone of
the meeting. In previous meetings, Roxas had asked us
to identify specific issues so that he could work with
us to address them. Now that the USG has done that, he
seemed willing to follow through. Ultimately, he will
be responsible to his constituents and their demands
for cheaper medicines, but there is now an opportunity
to collaborate and ensure that new legislation
addresses USG concerns.

   

 

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