July 9 (Bloomberg) -- Taiwanese employers haven’t renewed contracts for about 10,000 Filipinos since the Philippine coast guard’s shooting of a fisherman at sea in May sparked a diplomatic dispute and a hiring freeze.
Most of the workers were from factories and about 77,000 Filipino staff remain in Taiwan, the Manila Economic and Cultural Office said today. Permits for about 3,000 workers each month will expire until December, Taiwan Council of Labor Affairs official Chen Jui-chia said by phone today. Foreign workers’ three-year permits can be renewed as many as three times.
The shooting and the two countries’ disagreement over its circumstances have soured ties and the losses may slow Philippine President Benigno Aquino’s push to cut unemployment that stood at 7.5 percent at the end of April, a three-year high. Taiwan was the seventh-biggest destination for Filipino workers last year, according to Philippine government data.
Taiwan President Ma Ying-Jeou recalled his representative from the Philippines and froze the hiring of workers from the Southeast Asian country on May 15, rejecting Aquino’s apology over the fisherman’s death, which occurred in disputed waters. Travel agencies canceled trips amid a broader Taiwanese halt to diplomatic engagement. The two sides have yet to release the results of their investigations into the incident.
The penalties levied on the Philippines may rebound on Taiwan, according to Ramon Casiple, executive director at the Institute for Political and Electoral Reform in Manila. “Taiwan has more to lose,” Casiple said in a phone interview. “The Philippines is one of few countries that is still talking to Taiwan.”
The Philippines, which doesn’t formally recognize Taiwan under its one-China policy, agreed to compensate the family of the dead man and hold talks on fishing zones. Initial talks were held on June 14 ahead of formal fisheries negotiations to be held at a future date.
Ma said he wasn’t satisfied with the Philippine response to the May 9 shooting, highlighting strains in a part of the South China Sea beset by competing territorial claims from countries including Taiwan, the Philippines, Vietnam and China.
“We are working on the lifting of the hiring freeze,” Amadeo Perez, chairman of Manila Economic and Cultural Office, said by telephone today. The total $21.4 billion in Philippine remittances in 2012 helped boost an economy that grew at the fastest rate among the 17 biggest economies in Asia in the first quarter from the previous year. Money sent home by offshore workers accounts for about 10 percent of the country’s gross domestic product.
Philippine investigators have endorsed charges against coast guard officers involved in the confrontation, Justice Secretary Leila de Lima said on June 13. Aquino is reviewing the justice department report on the incident, his spokeswoman Abigail Valte told reporters in Manila today.
Taiwan will lift its economic measures against the Philippines if it responds positively to Taiwan’s requests in regard to the shooting, the Central News Agency reported last month, citing Ma.
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