Part IV. Proposed Changes to the 1987 Constitution B. Economic Policies 1.

Repeal all provisions which limit to Filipino citizens or Filipino-controlled corporations: exploitation of natural resources De-Filipinizing the Constitution Ron Michael B. Garcia Despite the highly political underpinnings of the proposal for Charter Change, there are evident far-reaching proposed amendments on what has been coined as the Filipino First Constitutional provisions on the national patrimony and economy. The general proposition is the liberalization or repeal of all the provisions which provide exclusive benefit or privilege to Filipino citizens or Filipino-controlled corporations as against foreigners, who are completely prohibited. One such area is the exploitation of natural resources, embodied in Section 2, Article XII (National Economy and Patrimony). The basic contention towards repealing such protectionist provisions is the belief in development or progress espoused on the economic ideology of liberalism in a globalized world system. Primarily, economic experts have argued that the Constitutions protectionist tradition has not produced the economic development envisioned. Furthermore, some have argued that the economic provisions of the Constitution are the barriers that prohibit the attainment of greater economic progress and have burdened the country with loss of competitive capacity (Sicat). Among the pertinent portions of Section 2, Article XII states that all other natural resources, with the exception of agricultural lands, shall not be alienated, being owned by the State. The State may directly undertake such activities, or it may enter into co-production, joint venture, or production-sharing agreements with Filipino citizens, or corporations or associations at least sixty per centum of whose capital is owned by such citizens (Sec. 2, Art. XII). Clearly, the Constitution mandates that only Filipinos and Filipino-controlled corporations (60% Filipino ownership) may participate in the development and utilization of these natural resources (Bernas 1136). Moreover, it is only either through direct undertaking of the State or through coproduction, joint venture, or production-sharing under its full control and supervision that exploration, development, and utilization may be conducted (Bernas 1138). Only small-scale utilization of natural resources may be allowed by Congress through enactment of law, and this again is limited to Filipino citizens (par. 3, Sec. 2, Art. XII). Also reserved for the exclusive use and enjoyment of Filipino natural persons are the nations marine wealth in its archipelagic waters, territorial sea, and exclusive zone (Bernas 1140). Generally, the proposed liberalization of the provisions of the Constitution seeks to repeal the provisions of Section 2, Article XII by removing the pertinent phrases and paragraphs that limit exploitation rights of natural resources either to Filipino citizens or corporations whose ownership is not less than 60% Filipino, in order to allow foreigners to undertake the same activities previously exclusive to Filipinos. The argument relies on the belief that foreign direct investment (FDI) will provide the quickest way to generate more capital to raise the economys

overall performance. Implied in this proposition is a policy of non-discrimination and meritbased selection. FDIs are deemed to increase capital and financial flow in the local market purportedly necessary as a source for development projects. Liberalization is primary sought for the promotion of the countrys competitiveness in the global economy and as a means to attract foreign capital to accelerate local economic growth. Among other incidental benefits envisioned through the attraction of FDI are the introduction of technology and management expertise, broader employment opportunities, and healthy competition beneficial to the consumer (Ateneo Law Journal 412). An important facet of the proposed repeal of protectionist provisions is the transfer of regulation of these sectors to Congress to consequently effectuate flexibility responsive to changing circumstances (ALJ 417). Sicat adds that relegating the regulation of economic development policies to ordinary legislation would provide a venue for debate of economic issues and decisions according to the circumstances that define those challenges. Moreover, the government could supposedly enter into appropriate production sharing arrangements and assert its power of taxation. To stress his point, Sicat states, Let not inflexible orders from dead leaders tell us, the living, what to do with our future. Without a doubt, there is wisdom in the propositions for liberalizing the Constitution. However, these promises of national development are not all milk and honey. This protectionist tradition of prohibiting the alienation of natural resources in Philippine Constitutional history originated as a reaction to the exploitation brought about by the Parity Rights Amendment during the American occupancy. In Republic v. Quasha (46 SCRA 160, 170), it was emphasized that the Filipino people included this measure in the Constitution in order that it may have the stability and permanency that its importance requires. Just as the contention that protectionism over our natural resources has hindered economic development, there has been consequently no showing that liberalization would provide the necessary surge towards development. For one, Philippine participation in international organizations with liberalism as the underlying economic framework has no apparent showing that it has redounded to the benefit of the countrys economic development. On the other hand, there have been instances where local exporting manufacturers have struggled even more as they try to compete in the international market together with the economic giants such as America and China. In this light, the political rationalist perspective of inequality in the international arena is inseparable from the analysis that despite the benevolent promises of liberalization, there is stark inequality in the international arena and acting on national self-interest, those holding the power seek to maintain such inequality. It cant further be over-emphasized that permission for foreigners to exploit our natural resources would pose threats not only to our national integrity but also to the physical aspect of our national patrimony. FDIs would definitely bring in capital, which the Philippines arguably lack. Furthermore, it would possibly bring the consequent infrastructure and expertise, which would probably redound to our benefit, but it is critical to understand that profit maximization and repatriation are the underlying principles rather than benevolence. As there might be shortterm benefits of capital influx, when initial capital has been offset by prior earnings, repatriation of subsequent incomes would serve the opposite end and further deprive our economy of the much needed capital. Representative Teddy Casio further allege that instead of being used to

develop local industry, our resources will most likely be exported to serve the needs of other countries (Remollino). Moreover, underdeveloped countries such as the Philippines, with undeveloped environmental protection legislation, would have no defense to the very kind of exploitation of our posterity experienced before with the Americans. Furthermore, there is also clear exploitation of our cheaper labor as compared to the supposed wages foreigners pay in their own countries. Conceding to Sicats proposition that the government could set-up appropriate production sharing arrangement and impose taxes, there is much to be considered in terms of political maturity and genuine public administration in our government. Before any such changes take place then, it is fundamental to ask, Will it really be for the benefit of the Filipino people? Without safeguards against such current disadvantages, to speak of prospects of competitiveness and equality in the international arena are beyond present reality. Without showing that in the long-run, after supposed sacrifices, well genuinely develop, risking our natural resources is no fair trade. Changing our fundamental law for mere conjectures need more than second thoughts. Bibliography: Summary Report of the Preparatory Commission on Constitutional Reforms (1999) from Ateneo Law Journal (Leg Hist reading) cite as 48 ATENEO L.J. 390 (2003) yan ung nakalagay sa baba niya... Bernas book the SCRA case cited above Sicat, Gerardo P. (2005). Reform of the Economic Provisions of the Constitution: Why National Progress is at Stake. Discussion Paper in the UPSE. September 2005. Matrix of ConCom proposed charter amendments (pero reference lang siya, kasi matrix nga..) from http://www.pcij.org/blog/wp-docs/matrix-concom-proposed-charter-amendments.pdf accessed October 4, 2008. Remollino, Alexander Martin. (2006). Charter Change: The Other View. accessed from http://www.bulatlat.com/news/5-48/5-48-chacha.htm on October 4, 2008. Vol. V, No. 48. January 15-21, 2006. pasensya na..bano ako mag-bibliographic entry..haha..kaya mas masaya sariling ideas...