D E C I S
I O N
(En Banc)
PANGANIBAN, J.:
I.
THE FACTS
Petitioners Senators Tañada, et al. questioned the constitutionality of the concurrence by the Philippine
Senate of the President’s ratification of the international Agreement
establishing the World Trade Organization (WTO). They argued that the WTO Agreement violates
the mandate of the 1987 Constitution to “develop a self-reliant and independent
national economy effectively controlled by Filipinos . . . (to) give preference
to qualified Filipinos (and to) promote the preferential use of Filipino labor,
domestic materials and locally produced goods.” Further, they contended that
the “national treatment” and “parity provisions” of the WTO Agreement “place
nationals and products of member countries on the same footing as Filipinos and
local products,” in contravention of the “Filipino First” policy of our
Constitution, and render meaningless the phrase “effectively controlled by
Filipinos.”
II.
THE ISSUE
Does the 1987 Constitution prohibit our
country from participating in worldwide trade liberalization and economic
globalization and from integrating into a global economy that is liberalized,
deregulated and privatized?
III. THE RULING
[The
Court DISMISSED the petition. It sustained
the concurrence of the Philippine Senate of the President’s ratification of the
Agreement establishing the WTO.]
NO, the 1987 Constitution DOES NOT prohibit our
country from participating in worldwide trade liberalization and economic
globalization and from integrating into a global economy that is liberalized,
deregulated and privatized.
There are
enough balancing provisions in the Constitution to allow the Senate to ratify the
Philippine concurrence in the WTO Agreement.
[W]hile the
Constitution indeed mandates a bias in favor of Filipino goods, services, labor
and enterprises, at the same time, it recognizes the need for business exchange
with the rest of the world on the bases of equality and reciprocity and limits
protection of Filipino enterprises only against foreign competition and trade
practices that are unfair. In other words, the Constitution did not intend to pursue an isolationist
policy. It did not shut out foreign investments, goods and services in the
development of the Philippine economy. While the Constitution does not
encourage the unlimited entry of foreign goods, services and investments into
the country, it does not prohibit them either. In fact, it allows an
exchange on the basis of equality and reciprocity, frowning only on foreign
competition that is unfair.
xxx xxx xxx
[T]he constitutional policy of a “self-reliant and
independent national economy” does not necessarily rule out the entry of foreign
investments, goods and services. It contemplates neither “economic seclusion”
nor “mendicancy in the international community.” As explained by Constitutional Commissioner Bernardo
Villegas, sponsor of this constitutional policy:
Economic self-reliance
is a primary objective of a developing country that is keenly aware of
overdependence on external assistance for even its most basic needs. It does
not mean autarky or economic seclusion; rather, it means avoiding mendicancy in the
international community. Independence refers to the freedom from undue foreign
control of the national economy, especially in such strategic industries as in
the development of natural resources and public utilities.
The WTO
reliance on “most favored nation,” “national treatment,” and “trade without
discrimination” cannot be struck down as unconstitutional as in fact they are
rules of equality and reciprocity that apply to all WTO members. Aside from
envisioning a trade policy based on “equality and reciprocity,” the fundamental
law encourages industries that are “competitive in both domestic and foreign
markets,” thereby demonstrating a clear policy against a sheltered domestic
trade environment, but one in favor of the gradual development of robust
industries that can compete with the best in the foreign markets. Indeed,
Filipino managers and Filipino enterprises have shown capability and tenacity
to compete internationally. And given a free trade environment, Filipino
entrepreneurs and managers in Hongkong have demonstrated the Filipino capacity
to grow and to prosper against the best offered under a policy of laissez
faire.
xxx xxx xxx
It is true, as
alleged by petitioners, that broad constitutional principles require the State
to develop an independent national economy effectively controlled by Filipinos;
and to protect and/or prefer Filipino labor, products, domestic materials and
locally produced goods. But it is equally true that such principles — while
serving as judicial and legislative guides — are not in themselves sources of
causes of action. Moreover, there
are other equally fundamental constitutional principles relied upon by the
Senate which mandate the pursuit of a “trade policy that serves the general
welfare and utilizes all forms and arrangements of exchange on the basis of
equality and reciprocity” and the promotion of industries “which are
competitive in both domestic and foreign markets,” thereby justifying its
acceptance of said treaty. So too, the alleged impairment of sovereignty in the
exercise of legislative and judicial powers is balanced by the adoption of the
generally accepted principles of international law as part of the law of the
land and the adherence of the Constitution to the policy of cooperation and
amity with all nations.
That the Senate,
after deliberation and voting, voluntarily and overwhelmingly gave its consent
to the WTO Agreement thereby making it “a part of the law of the land” is a
legitimate exercise of its sovereign duty and power. We find no “patent and
gross” arbitrariness or despotism “by reason of passion or personal hostility”
in such exercise. It is not impossible to surmise that this Court, or at least
some of its members, may even agree with petitioners that it is more
advantageous to the national interest to strike down Senate Resolution No. 97.
But that is not a legal reason to attribute grave abuse of discretion to
the Senate and to nullify its decision. To do so would constitute grave abuse
in the exercise of our own judicial power and duty. Ineludibly, what the Senate did was a valid
exercise of its authority. As to whether such exercise was wise, beneficial or
viable is outside the realm of judicial inquiry and review. That is a matter
between the elected policy makers and the people. As to whether the nation should
join the worldwide march toward trade liberalization and economic globalization
is a matter that our people should determine in electing their policy makers.
After all, the WTO Agreement allows withdrawal of membership, should this be
the political desire of a member.
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