The Philippine Maize Federation Inc. (PhilMaize) has formally asked the government to investigate and stop the allegedly ongoing technical smuggling of corn from Vietnam, which pose threats to local corn farmers and the livestock sector.
PhilMaize President Roger Navarro, in a letter-request, asked the Department of Agriculture, Department of Trade and Industry and Bureau of Customs to conduct the investigation and verify reports of technical smuggling of corn.
Navarro said that he received reports that the corn shipments – listed as originating from Vietnam and Thailand – actually came from Argentina and Brazil.
Accordingly, the official said that this transaction is facilitated through Philippine trading agents, Agri Multicom Trading and CDO Corn for San Miguel Corp., supplied by Vina Commodities of Vietnam
If the corn shipments were declared as originating from Vietnam, an import duty of only five percent would be imposed pursuant to the Association of Southeast Asian Nations (Asean) Free Trade Agreement.
However, should the cargo be declared as Argentina or Brazilian origin, the PhilMaize chief said that importers would have to pay an import duty of 35 percent if the shipment is within the minimum access volume (MAV) for corn or 50 percent if outside the MAV.
“It is very clear in this transaction that the exporter Vina Commodities was issued by the government of Vietnam the certification of origin, whose only purpose is to help the Philippine importers evade payment of the correct tariff,” Navarro said.
PhilMaize informed the government that some 500,000 metric tons (MT) of corn coming from Argentina and Brazil have been brought to the country via Vietnam in June 2014.
From this volume of corn at landed cost of P14.00 per kilo, with a tariff rate of 50 percent, importers are obligated to pay at least P7.00 per kilo, or a total of P2.1 billion in tariffs and duties.
PhilMaize also questioned the “sudden” capability of Vietnam to export huge volumes of corn, citing that the country has been importing corn to fulfill requirements.
Navarro, thus, urged the government to compel Vietnam and Thailand to undertake measures to prevent the scheme.
“We, the corn farmers in the country, strongly believe that we should uphold the credibility of the agreement in Asean Integration and to put in place the needed safeguard measures. Otherwise, skirting the rules of origin will make this systematic and widespread, which can be abused comfortably by wanton, unscrupulous business people,” he said.
PhilMaize also asked the DA-Bureau of Plant Industry to test the content of the corn shipments to prove that it did not come from Vietnam, noting that Hanoi does not authorize the use of biotechnology or genetically modified corn.
Navarro, meanwhile, revealed that Philippine corn importers are applying for an increased MAV to import another 100,000 MT of corn from Argentina, noting that two vessels with a capacity of 50,000MT each are scheduled to arrive in the country soon.