The WTO and the crisis of the Philippine educational system

i shall be off to hongkong in barely a week’s time. malamig daw doon ngayon, 10 degrees, and i honestly haven’t had the time (or means) to bunch up on heavy jackets, ear muffs, etc etc. am still short on cash too so disneyland will most probably be a non-event for me. i’m posting the position paper i prepared for the philippine youth delegation for the People’s Action Week (december 11-18, 2005) — and, incidentally, the only preparation i shall be needing before i take off. (hehe, GnD, ba?)

The Cancun agenda
Since the unprecedented display of unity of underdeveloped countries in the 5th World Trade Organization Ministerial Conference in Cancun, Mexico, the United States and the European Union have been hell-bent in forwarding their failed Cancun agenda to WTO member countries.

The primary objective of the Cancun agenda, as in the four preceding WTO Ministerial Conferences, was the proposal to further broaden the Doha Development Agenda (DDA) in 2001. The DDA recommended initial negotiations on the inclusion of ‘non-agricultural tariffs, trade and environment.’ It discussed in context the WTO’s additional enclosure of subsidies it shall provide for member governments, investment, competition policy, trade facilitation, transparency in government procurement and intellectual property.

It was also in the Doha Declaration that the schedule for the controversial ‘request-offer phase’ of the General Agreement on Trade in Services (GATS) was set. The US, EU, Canada and Japan presented a comprehensive platform for negotiations under the GATS for the 146 member countries of the WTO. This was what was so heavily contested by underdeveloped countries in Cancun, resulting in the historical ‘Cancun revolt’.

‘LDCs are receiving requests for commitments in broad sectors of Services like Telecommunications, Construction and related Engineering Services, Environmental Services, Financial Services, Transport Services, Audio Visual Services etc… LDCs have difficulties in addressing complex issues of Services negotiations due to lack of institutional and human capacities. The constraints faced by LDCs in analysing offers and making requests should be factored into the negotiating process in general and into the individual requests made to LDCs in particular.
-This was submitted to the WTO by Bangladesh, on the 18 June 2003

By August 2003, only 30 members of the WTO submitted their initial offers. Though some attributed failure to submit to strict deadline of negotiations and shortage of institutional and human resources, majority of poor member countries expressed overall apprehension over opening their markets in light of unequal capabilities in global services.

Protests around the world questioned the addition of education and other social services in the GATS. Critics against the inclusion of education and other basic services for the ‘public good’ as services for trade have questioned the necessity and wisdom of commodification for profit – especially at the expense of public utilities and services – in the event that the GATS be implemented to its fullest.

In the Philippines, the present Arroyo regime has declared unflagging support for the GATS without ample preparation for protection for the local economy. No consultations were held and the Filipino people remain clueless to the possible detrimental effects of the GATS on their welfare and interests.

Though the Philippine government has not yet fully subjected itself to the GATS, certain provisions, structural adjustments and directions are presently being made in an obvious maneuver to pave the way for its eventual implementation.

This paper aims to particularly discuss and clarify GATS and its implications on the already worsening crisis of the Philippine educational system.

World Takeover Organization
The US, through the International Monetary Fund-World Bank (IMF-WB), established the GATT with the objective to dismantle restrictions in so-called free trade among its member countries. The GATT was chiefly responsible for the stipulation of ‘free exchange’ of products, investment and services.

In 1995, the WTO officially replaced the GATT in overseeing and implementing treaties and agreements among its members. This was instated during the GATT Round, more popularly know as the Uruguay Round signed by the member countries in Marrakesh last 1994.

The Uruguay Round was a turning point in world trade. It encompassed not only agreements on trade in industry and agricultural products (GATT and the Agreement on Agriculture or AoA) but mandated the WTO to include trade in services (GATS), investment and copyright (Trade-related Aspects of Intellectual Property Rights or TRIPS).

The Philippine Senate ratified the GATT in 1994, and became an official member of the WTO in 1995. Then senator and now president Gloria Macapagal-Arroyo was one of the staunch supporters in government of Philippine accession in the WTO despite public censure.

Since then, past and present Philippine regimes have steadfastly abided by the WTO’s strict and dogmatic adherence to liberalization, deregulation and privatization under the banner of globalization. The WTO, on the other hand, enjoys free will to administer and monitor the implementation of its treaties in the Philippines, for instance the reduction or abolition of tariffs in certain imported products.

What’s education GATS to do with it?
Trade in the service sector has long been posted by the WTO as a significant agenda in the advancement of a local economy. But as a basic sector, governments reserve the right and responsibility in this particular field. Hence the WTO’s persistent program to impel its member countries to subject the sector under its mandate.

For the past decade, imperialist powers led by the US have pushed for a neo-liberal policy characterized by loosened regulation of economies worldwide. Its mainly aims to make up for grave economic losses and recession in imperialist countries brought on by overproduction, overspending in imperialist wars of aggression and over-lending to poor countries to acquire super profit through projected interest payments. Suffice to say, since the Great Depression in the 1920’s, the US has not fully recovered from its economic losses despite gains in wars of aggression and occasional booms information and technology sector.

This is where the GATS sets in. Dominant countries in the WTO have undoubtedly much to gain in the full implementation of GATS. In 2001, trade in services accounted for 70 percent of the US economy, and more than 60 percent of the world economy. Aside from services in industry, which is globally considered as the most profitable sector of trade, health, education and water sectors come in close second under the category of ‘lucrative services.’ An estimated $2 trillion is acquired yearly from trade in the education sector alone.

The GATS specifically stipulates that it is exclusive of trade in services provided for by governments, and with no commercial basis or not involved in any competition with one or more service suppliers. Despite these, the education sector remains under threat. According to the US Coalition of Service Industries, the WTO aims “to fully embrace important new sectors in the liberalization effort. These new sectors…include…existing ones that have not received sufficient attention, like education.” Through powerful machineries such as the US Coalition of Service Industries and the European Union Service Forum, the GATS can be easily implemented despite certain restrictions in a country’s existing constitution.

Based on the United Nations Provisional Central Product Classification (UN PCPC), the education sector is categorized into five services:

• Primary education, covering preschool and other primary education services, but excluding child care services;
• Secondary education, including general higher secondary, technical and vocational secondary and technical and vocational services for disabled;
• Higher Education, covering post secondary technical and vocational education services as well as other higher education services leading to university degree or equivalent;
• Adult Education covers education for adults outside the regular education system;
• Other Education; which covers all other education services not elsewhere classified; nonetheless education services related to recreation matters are not included.

As of present, 44 out of 146 member countries already have commitments in education, 21 of which have expressed commitment in subjecting higher education to the GATS. These include Congo, Lesotho, Sierra Leone and Jamaica, while Australia has included even its private education sector in its provision for trade in service, including their universities.

Only Australia, New Zealand, USA and Japan as countries with commitments in higher education have submitted their respective proposals during the last WTO Ministerial Conference.

Modes of Supply
The WTO has devised four ways to implement the GATS in education:

mode 1 – cross-border-supply (e.g. distance delivery or e-education; virtual universities)
– primary and secondary education have been fully committed without any limitations in slightly more than half of the ‘schedules’ (commitments appear as a list of sectors being opened, the extent of market access being given in those sectors, e.g. whether there are any restrictions on foreign ownership, etc)
– the corresponding share for “higher education” and “adult education” is higher; where approximately three-quarters of all commitments are without limitations

mode 2 – consumption abroad of education services (e.g. students studying in another country)
– very rare in all education sub-sectors (baket?)
– countries saw less need, or scope, for restricting trade under this than any other mode of supply, given that the consumption of the service takes place outside their national boundaries

common barriers for mode 3 – commercial presence (e.g. branch or sattelite campus; franchises; twinning arrangements)
– primary, secondary and higher education have “no limitations (paano?)” in about half of the schedules

mode 4 – presence of natural persons (e.g. teachers travelling to foreign country to teach)
– almost every country has “unbound” commitments across all education sub-sectors, implying that no commitments in those sectors have been taken

* WTO members have chosen to impose more limitations on trade in educational services in modes 3 and 4 than in modes 1 and 2; as with trade in other services
* Member countries have in general put slightly more limitations on trade in primary and secondary education than on higher and adult education

Trade barriers
Since the elimination of barriers to trade in higher education services (raison d’etre of GATS), identification of these barriers is fundamental. While some barriers are applicable to all sectors, other impediments are specific to the education services sector.

The majority of generic barriers are from an exporter country’s point of view and focus on the supply modes “cross border supply” and “commercial presence”:

• There is a certain lack of transparency of government regulatory, policy and funding frameworks
• Domestic laws and regulations are administered in an unfair manner
• Subsidies are not made known in a clear and transparent manner
• Tax treatment which discriminates against foreign suppliers
• Foreign partners are treated less favourably than other providers

Principal barriers of:
Mode 1 cross-border-supply
• Inappropriate restrictions on electronic transmission of course materials
• Economic needs test on suppliers of the services in question
• Lack of opportunity to qualify as degree granting institution
• Requirement to use local partners, with at the same time a barrier against entering into and exiting from joint ventures with local or non-local partners on a voluntary basis
• Excessive fees/taxes imposed on licensing or royalty payments
• Restrictions on use/ import of educational materials

Mode 2 consumption abroad
• Measures that restrict the entry and temporary stay of students, such as visa requirements and costs, foreign currency and exchange controls
• Recognition of prior qualifications from other countries
• Quotas on numbers of international students in total and at a particular institution
• Restrictions on employment while studying
• Recognition of new qualification by other countries

Mode 3 trade via commercial presence
• The inability to gain the required licences to grant a qualification
• Subsidies provided solely to local institutions
• Nationality requirements
• Restrictions on recruitment of foreign teachers
• Government monopolies
• Difficulty in obtaining authorization to establish facilities
• Prohibition of higher education, adult education and training services offered by foreign entities

Mode 4 presence of natural persons
• Measures that restrict the entry and temporary stay and work for the service suppliers, such as immigration barriers, nationality or residence requirements, quotas on number of temporary staff, employment rules
• Economic needs test
• Recognition of credentials
• Minimum requirements for local hiring being disproportionately high
• Repatriation of earnings is subject to excessively costly fees or taxes for currency conversion

Though the US stresses that the ‘public-private mix’ will in no way affect subsidies provided for by governments for education, the question remains on who will benefit most from this combination.

Because the US educational system is by far more developed and sophisticated, there is no assurance that any country it is involved with in trade can compete freely with regards to liberalization of education. This may result in 1.) government cutbacks, or budget cuts in education, impelling public schools and state universities to resort to private or foreign funding; 2.) eventual overhaul of a country’s national educational curriculum (from the secondary to the tertiary levels in the public education sector) in favor of a ‘more global’ curriculum which may be off-tangent to its needs and interests. One glaring example in the Philippines is the adoption and approval by the University of the Philippines’ Board of Regents of a Revitalized General Education Program (RGEP) in 2002.

Furthermore, while the WTO insists that any government reserves the right to choose which sector it wishes to subject under the GATS, this clause is not applicable to an import-oriented export-dependent state such as the Philippines. Almost all service sectors have gone or undergoing liberalization in effect of multilateral and/or bilateral agreements with the US.

The commodification of education
Education is a very lucrative sector worldwide. It poses a promising potential for profit brought on by sophisticated technology used presently in more advanced schools and universities worldwide. It is represented by more than 50 million teachers, one billion students and hundreds of thousands of schools around the globe. In 1995, for instance, the college education sector produced a total profit of $27 billion. Education is also conceived as a stable business enterprise because it never loses ‘clients.’

GATS in education is anchored mainly on the promotion and implementation of liberalization of trade and industries in favor of MNCs and TNCs. It is based on the theory that state subsidies for education will prove detrimental to an economy because funds will only go to waste due to government inefficiency. It further surmises that the service sectors, education in particular, should be entrusted solely to private sectors; and that tertiary level education should not be allotted public subsidy because the acquirement of which will only benefit an individual (college graduates) and not a nation as a whole.

This school of thought influenced many governments resulting in large budget cuts in education. Financial crisis in most of the biggest universities worldwide has forced governments to succumb to privatization in exchange for autonomy – at the expense of intellectual and human capital.

GATS in education poses a quick and direct threat. It institutionalizes the intervention of private corporations in academic environments. Under the dictates of foreign capital, the structure and concept of a university is in danger of being controlled and overhauled – from the appointment of officials, curriculum, approval of research projects, collection of tuition to evaluation of instruction. Through the years, education has been assessed on basis of efficiency, cost-benefit and maximization of resources.

The University of Cambridge, for example, had a Shell chair in Chemical Engineering and a Unilever Chair of Molecular Science. Burger King, meanwhile, has 14 academies in the US while Bell and Howell supports 30, 000 students in college.

Broadening the range of the GATS in education has caused more and more schools to prioritize projects in support of export of service to foreign countries for super profit. Because of the GATS, more and more poor countries are in danger of being included in the education market.

The conduct of education as a trade in service has been encountering massive protest worldwide. It entails dependence on private funding, standardization of education and culture, mechanization, dislocation of traditional faculty and academic workers and violation of national sovereignty. Much worse, it justifies the commodification of education around the world under the design and benefit of a few powerful imperialist corporations.

Miseducation in the Philippines
The prevailing crisis in the Philippine educational system is deeply rooted in the government’s consistent adherence to policies and dictates of US imperialism.

Former president Ferdinand Marcos formed the Presidential Commission to Survey Philippine Education (PCSPE) funded by the Ford foundation to conform Philippine education towards ‘global economic development.’ This resulted in the establishment of ‘polytechnic school systems’ and vocational education to cater mainly to requirements of multinational companies. Thus, then Philippine College of Commerce was transformed into the Polytechnic University of the Philippines in the 1980’s. Through this scheme, the Philippine educational curriculum gradually lost sovereignty. Courses and subject matters catered solely to the needs of the so-called global market.

Foreign capital was used to produce fresh graduates who would later on work for multinationals. The WB allotted $767 million to fund for Pres. Marcos’ Textbook Development Program. It was used to publish an estimated 89-92 million copies of new textbooks patterned after those used by primary and secondary schools in the US. Such a scheme ensured the training of students for ‘global development’ at their early stages of schooling.

Actual commodification of Philippine education worsened upon the ratification of the Education Act of 1982 – a law that gave complete control to capitalist educators to raise tuition fees in private schools. This law was later on utilized by the WB to bribe capitalist educators to adhere to their dictates on education.

As of present, such schemes continue to govern the Philippine educational system. Yearly tuition and miscellaneous fee increases characterize the state of public and private schools nationwide. The situation turned from bad to worse upon the ratification of the GATT-WTO in the Philippines. Its first three years in effect caused education costs to increase by 50 percent. A family now needs to raise an average of P20,000 to P25,000 yearly for a child’s schooling, tuition fee not yet included.

Meanwhile, most schools and universities are fully or partially foreign-owned. Among these are info-tech and specialization schools such as the AMA universities, System Technology Institute (STI), Centro Escolar University (CEU) and the Far Eastern University (FEU).

In the latest GATS round of negotiations, the WTO proposed that particular countries, including the Philippines,“…Egypt:India:Mexico:Philippines:Thailand: Undertake full commitments for market access and national treatment in modes 1,2, and 3 for higher education and training services, for adult education, and for “other” education, and for testing services. Consistent with the commitments, countries remain free to review and assess higher education and training, by governmental or non-governmental means, and to cooperate with other countries, for purposes of assuring quality education. Remove ownership limitations on joint ventures with local partners…”

Intellectual poverty
While the GATS virtually bares trade in service of poor countries open wide to imperialist control, the TRIPS ironically promotes a rigid protectionism of the same foreign powers in trade.

Article 9 of the TRIPS obligates WTO member countries to abide by the policies of the Berne Copyright Convention of 1971. Both the TRIPS and the Berne Convention stipulate strengthened protection of intellectual property rights, mainly of products from first world countries. Through these, certain academic and resource materials could not be easily translated or published without permission from the author or publisher. This contradicts Philippine Presidential Decrees 285, 400 and 1203 which give permission to public schools, institutions and libraries to reprint any book or article of foreign origin as temporary or permanent recourses to cope with the increasing costs of research materials, and which the government could not afford to acquire. According to data from the Reprint Committee from 1978 to June 1993, 3,018 titles have been reprinted in effect of the said decrees and used as materials for textbooks and references for college.

The TRIPS also mandates that member countries abide by Article 21 of the Appendix of the Berne Convention on reproduction and reprinting. It provides very strict and rigid conditions and will make it next to impossible to reprint materials for academic use. The article allows specific cases under the condition of stricter guidelines that by the time they have been met the books or articles in question may already be outdated and obsolete.

Reprinting and/or republishing is only one aspect of the many effects the TRIPS may have on Philippine education. It also encompasses technology, computer technology and other educational fronts.

Struggle for a nationalist, scientific and mass-oriented education
The national democratic youth movement in the Philippines maintains that liberalization and privatization will not resolve the current crisis in Philippine education.

Firstly, a nationalist curriculum should be advocated to serve the country’s interests and needs. The Philippines, an economy based mainly on agriculture, should prioritize courses and subjects for the development and improvement of the country’s agricultural capacities. Over the years, there has been an overwhelming growth in number of courses such as care-giving and other certificate courses in education and nursing to cater to the phenomenal exodus of Filipinos abroad.

AMA University’s ‘robotics’ genre, for example, successfully attracts impressionable youths and parents and is abused by the government to create illusions of economic development. Courses such as these, however, will remain illusionary until the country’s economy ceases from being backward and agricultural. Hence, despite the increase in number of such schools, graduates will not be able to use their acquired knowledge to build new tools for agricultural production (i.e. tractors) which the country direly needs. A scientific education should also be prioritized for national industrialization. To achieve this, there is an urgent need to replace and overcome the dominantly backward and colonial curriculum.

In light of the present commercialized state of education, the Philippines produces more and more drop outs annually. A mass-oriented education cannot be realized unless the government provides sufficient funds for the education sector. The Philippines has, through the years, consistently violated Article 26 of the UN Declaration on Human Rights declaring that ‘access to higher education is a right’ and should be provided for by governments accordingly.

The Filipino youth’s struggle for a nationalist, scientific and mass-oriented education is not isolated from the global struggle for social justice, peace and decent living. It unites with other poor countries worldwide in aiming to expel and defeat imperialist control for the achievement of free, just and truly democratic nations. ###

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One Response to The WTO and the crisis of the Philippine educational system

  1. peter says:

    Hi Nice Blog. I like to spend my holidays in egpht through Egypt visa

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