Govt now deliberating tariff rate reduction for rice under AFTA-CEPT Economy
June 16, 2009


Written by Jennifer A. Ng / Reporter

Business Mirror ph/home/economy/ 11836-govt- now-deliberating -tariff-rate- reduction- for-rice- under-afta- cept-.html


THE Philippine government is now in the middle of deliberating the possible rate of tariff reduction for rice under a free-trade scheme among members of the Association of Southeast Asian Nations (ASEAN).


Segfredo Serrano, agriculture undersecretary for policy and planning, however, said there is no final decision   yet on the starting tariff rate for rice traded under the Asean Free Trade Area-Common Effective Preferential Treatment (AFTA-CEPT).


“[Reducing tariffs for rice] needs careful study. The government is still weighing its options carefully, that is why we hold consultations,” said Serrano in a telephone interview.


He said a series of consultations organized by the government on a nationwide scale were recently concluded. “The sentiment [of those consulted] is that they oppose the reduction of tariffs under AFTA.”


Under the Afta-CEPT scheme, tariffs for certain farm products (excluding those in the so-called highly sensitive list) will start going down to between zero and 5 percent by 2010. Rice is in the highly sensitive list so the duty will remain the same.


If Asean will not agree to delay the reduction of tariffs for rice in 2012, the Philippine government would be forced to bring down the duty for rice currently set at 40 percent to honor its commitment to the Afta-CEPT scheme.


The Tariff Commission has also held a hearing/public consultation on Tuesday to discuss the tariff-rate modality for rice.


Rice farmers represented by the Rice Watch Action Network (R1) and other organizations such as the National Rice Farmers Council (NRFC) presented a position paper opposing the reduction of tariffs on rice once the commodity is relegated to the so-called inclusion list of the Afta-CEPT.


“The government should establish a strong and competitive rice industry before opening up the local market to competing rice from the Asean countries. Let’s talk about the inclusion of rice in the Afta-CEPT after the government has successfully achieved its rice self-sufficiency target by 2013,” said Jessica Reyes-Cantos, R1 lead convenor.


R1 criticized the liberalized importation of rice as detrimental to the country’s vision of self-sufficiency as it will also be injurious to the livelihood of the local rice farmers.


“How can we compete against unabated rice importation when prices from other Asean countries are traditionally cheaper than rice produced locally?” said Jaime Tadeo, a farmer leader and spokesperson for the NRFC.


R1 urged the Senate to review the country’s commitment to the AFTA-CEPT scheme.

“With so many issues raised before and again now with the inclusion of rice, the Senate should intervene and subject Afta to ratification and closely scrutinize the government’s commitments in the interest of the farmers’ livelihood and the country’s food security,” said Cantos.


In an interview, Philippine Rice Resarch Institute (PhilRice) executive director Ronilo Beronio said the Philippines has the capacity to compete against other Asean rice-producing countries.


“Kaya naman natin [we can compete]. We have good rice varieties as evidenced by the fact that our rice production continues to go up despite the destruction caused by storms,” said Beronio.


Also, he said the government is ready to pump more money into the country’s rice sector as part of efforts to make the Philippines self-sufficient in rice by 2013. For one, PhilRice has recommended a budget of P15 billion for the rice program for next year.


“I suggested that the government’s target of achieving rice self-sufficiency by 2013 should be taken into consideration during deliberations for AFTA-CEPT,” said Beronio.


The Tariff Commission said the hearing held on Tuesday is the only public hearing on the matter, and that it will make a recommendation to the Committee on Tariff and Related Matters (CTRM). Stakeholders and other parties are given until June 30 to submit their position papers.


The CTRM advises the President and the National Economic and Development Authority Board on tariff and related matters and on the effects on the country of various international developments.


The CTRM also coordinates agency positions and recommends national positions for international economic negotiations, and recommends to the President a continuous rationalization program of the country’s tariff structure.



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