After securing World Trade Organization (WTO) consent to extend the Philippines’ special treatment on rice, the Department of Agriculture is now pushing for the amendment of a local law that would establish a tariff system for the staple beyond 2017.
In a media briefing, Department of Agriculture Undersecretary Segfredo Serrano said that they are now studying the possible endorsement of crafting a bill to replace Republic Act 8178, or the Agricultural Tariffication Act of 1996.
Serrano said that it is the right time for the country to establish a system of determining proper tariff for the staple, noting that a tariff duty will be the instrument of protection for local palay producers once the quantitative restriction (QR) on rice expires by end of 2017.
“There should be coordination between the legislative and executive branches to craft a bill so that after 2017, when the quantitative restriction expires, there is already an existing tariff system for rice,” Serrano said.
Rice is a commodity that has direct links to food security, livelihood security and the rural development needs of millions of people in developing countries such as the Philippines.
At present, rice is the only commodity in the Philippines that enjoys special treatment under the WTO, which has excluded the same from agriculture liberalization.
Unlike other agricultural products, rice, which is the basic staple of the Philippines, was not covered by the tariff system with the WTO. Instead, rice farmers were protected through the imposition of a quantitative restriction, which allows only limited volumes of the grain to enter the country.
Recently, Manila more than doubled the volume of allowable rice imports as part of the trade concessions at the WTO in exchange for the extension of the QR on rice. From 350,000 MT of rice, the minimum access volume (MAV) was hiked to 805,200 MT.
MAV is the minimum volume of farm produce allowed to enter the Philippines at a reduced tariff of 35 percent, while shipments outside MAV pay higher rates of 50 percent and would need approval by the NFA.
Besides rice, the Philippines also allowed concession or market access to nine countries — including Australia, China, El Salvador, India, Pakistan, Thailand, Vietnam, Cambodia and the United States – for the entry via imports of certain products.
Starting July, these countries will be allowed to ship into the Philippines commodities – such as butter, milk, grated cheese, French fries, and frozen turkey – at reduced tariffs.
Serrano, however, declined to give further details on other concessions, saying that they have yet to submit the report to President Benigno Aquino 3rd.
“But these are just token concessions, and allowed to enter the country at applied rates.
During negotiations, we were guided by the instructions of Secretary (Proceso) Alcala that there should be no concession on commodities that we are producing, or on those that may affect our local production,” Serrano stressed.