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Saving free trade

Former British prime minister Tony Blair will be in Manila on March 23 to speak about “the leader as negotiator.” He will be sharing his experience in forging a peace agreement in Northern Ireland when he was prime minister.

Blair will be the latest in a lengthening string of visitors from the UK, among them a former fugitive bomber of the Irish Republican Army, who have shared with the Philippines their experiences in ending the armed conflict in Northern Ireland.

Blair, now a special peace envoy to the Middle East, won this month the $1-million Dan David Prize for his “exceptional leadership and steadfast determination” in furthering the cause of peace. The bulk of the prize will go to the Tony Blair Faith Foundation.

Last year’s winner was Al Gore, now a champion of the environment. The awarding foundation is based in Tel Aviv University, where Blair is popular for supporting the Middle East policy of George W. Bush.

That support, which Blair has steadfastly defended as an alliance based on shared values including freedom, cost him popular support back home.

Critics in the UK recently slammed him for his slow condemnation of Israel’s lethal counterattack against Hamas in Gaza.

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But Blair’s achievement in bringing peace to Northern Ireland is undeniable.

His visit will follow that of Scott Wightman, head of the UK Foreign and Commonwealth Office’s Asia Pacific Directorate. Wightman discussed the peace process in Mindanao with several Philippine officials.

Wightman, who arrived Tuesday in Manila from visits to Tokyo and Taipei, was in Asia mainly for the other concern of Gordon Brown’s government: the global economy.

The British prime minister, whose swift response to the credit crisis in the UK last year served as a model for other countries, is particularly worried about a growing protectionist reaction to the global economic slowdown.

The European Union, of which Britain is a member, has resumed export subsidies for its dairy industry. France has its own aid package for its carmakers.

US President Barack Obama has obtained congressional approval for his multibillion-dollar economic stimulus package, whose main feature is “buy American.”

Even in our country, whose economy is not export-dependent, the “buy Filipino” campaign has also been revived.

But if the world isn’t buying, what other choice does a country have except to stimulate local demand for local products?

London is hoping to keep nations trading when it hosts the meeting of the Group of 20 developed and emerging nations on April 2. The Philippines will be represented through the Association of Southeast Asian Nations, whose revolving chair is currently held by Thailand.

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The London Summit will be Obama’s first trip outside North America (his first outside the US, to Canada, does not count as a foreign trip, the Brits insist).

Obama is expected to be confronted with global concerns about the “buy American” provisions in his economic stimulus package.

As G20 summit host, Brown can discuss those concerns in advance with Obama when the two leaders meet in Washington on March 3.

Wightman is gathering the views of ASEAN and other Asian countries on “creeping protectionism,” which proponents of free trade warn would worsen the impact of the financial crisis.

In both Japan and Taiwan, Wightman told me, the export-oriented economies have been badly hit by the slump in global demand. Taiwan was among the first places to send back Filipino workers.

China, whose exports fueled its phenomenal economic growth, cannot afford to encourage protectionism even as it implements measures to stimulate local demand.

The London Summit, Wightman told guests at a dinner Wednesday hosted for him by UK Ambassador Peter Beckingham, hopes to build consensus on ways of addressing the crisis “so we will never find ourselves in this mess again.”

London is also expected to prod the International Monetary Fund to implement reforms, including greater IMF representation for Asia.

Shortly before Bush bowed out of office, he had extracted a commitment from G20 leaders at an emergency meeting in Washington last November to resist raising trade barriers. They also committed to overhaul the global financial system and keep alive free trade talks.

But Obama’s stimulus package now has America leading the protectionist trend, although a clause in his plan says stimulus measures should be consistent with Washington’s international trade commitments.

America’s trading partners are hoping to participate in the pump-priming public works projects under the stimulus plan. But the package requires that only goods made in USA can be used for the projects.

Already French President Nicolas Sarkozy, long a champion of government support for private enterprise, has said the European Union should protect its industries the way the US is doing.

World trade talks have been stalled for some time over agricultural subsidies and tariffs. The situation could worsen amid the financial crisis.

Not too long ago an American economist told me that certain goods are best produced in particular areas of the world under a certain environment by people with skills best suited to the activity. Free trade allows for the exchange of such goods and promotes efficiency and higher productivity, the economist pointed out.

But now even America is turning inward. Britain is hoping to keep free trade alive.

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