31.2 C
Manila
Friday, March 29, 2024

Bid to lower tariffs on pork, rice imports divides solons

- Advertisement -

LAWMAKERS are divided on the Executive Branch’s proposal to lower tariffs on pork and rice imports as a measure to stabilize domestic food prices.

During the joint hearing of the House Committee on Agriculture and Food and House Committee on Trade and Industry, Deputy Speaker Weslie Gatchalian said the Department of Agriculture should focus on how the agency will help and strengthen the local industry instead of reducing tariffs.

“In reducing the tariffs and adjusting the MAV [minimum access volume], we are encouraging importation, we are encouraging local businessmen to just proceed to importation and I think this is wrong,” Gatchalian told Agriculture Secretary William Dar.

“The DA should look into long-term solutions on how to strengthen the local industry and support all the stakeholders amid this pandemic,” the lawmaker added.

In the Senate Committee on Agriculture, Food and Agrarian Reform Chair Cynthia A. Villar earlier told Dar that the senators are also in “unison” in opposing any moves to reduce tariffs on food items.

But for his part, Secretary Dar said these proposals are only short-term solutions to address the existing problem, saying the agency’s “long-term solutions [include] enhancing and nurturing local commodity industries and mix interventions [being implemented by the DA].”

Economist-lawmaker Stella Luz Quimbo of Marikina also said the solution to food inflation requires a mix of policy responses, including reducing tariffs.

She said high tariffs and weak enforcement are among the factors driving smuggling. “Due to the high tariff at 40 percent, importers prefer to just smuggle. With rampant smuggling, imported meat will be too cheap and our local producers will not be able to compete, and government loses out on tariff revenues,” she said.

If the government rationalizes tariff rates at lower levels, Quimbo said, “this is tantamount to hitting two birds with one stone.

“Prices will fall and at the same time, importers will legitimately pay the tax,” she added.

Quimbo also recommended earmarking tariff revenues for subsidies for hog raisers and livestock producers.

“These subsidies should be utilized to help local producers address recent supply shocks and become more productive and competitive, especially against importers. Developing our domestic production is needed for food security in the long term,” the lawmaker said.

Key issues

House Committee on Agriculture and Food Chairman Mark Enverga said the DA should also first justify to Congress the basis of its proposed increase of MAV and lower tariffs.

“Would the cost of loss to the Acef [Agricultural Competitiveness Enhancement Fund] outweigh the benefits? How would it impact the local hog industry? Does this ensure lower prices of pork for the entire year? At how much? These are important issues that must be addressed [by the DA],” said Enverga.

The DA filed two petitions last week before the TC for the reduction of most favored nation (MFN) rates of pork and rice imports.

The DA petitioned to lower the tariffs for in-quota pork imports from 30 percent to 5 percent for the first six months; and to raise it afterward to 10 percent for the succeeding six months.

The DA also petitioned to lower the out-quota tariff for pork to 15 percent for the first six months and increase it to 20 percent for the next six months. Out-quota pork imports are slapped with a 40-percent tariff.

In terms of rice, the in-quota tariff for rice imports or those within the minimum access volume is at 40 percent, while those outside the MAV (out-quota) are at 50 percent.

Price freeze

Meanwhile, Dar told the committee that the 60-day price cap on pork and poultry products will start on February 8.

“The price ceiling will effectively be enforced by February 8, 2021, by all the institutions involved,” Dar said.

The DA said it is coordinating with the Department of Trade and Industry (DTI) and the Department of the Interior and Local Government (DILG), the Metropolitan Manila Development Authority (MMDA), and local governments to effect the efficient implementation of the EO imposing mandated price ceiling on pork and chicken in the National Capital Region.

These include publication and announcement of EO 124 in all media platforms; printing of tarps to be displayed in all public supermarkets in Metro Manila.

On Monday, President Duterte signed Executive Order 124 imposing a price ceiling for pork and poultry products in Metro Manila.

Under the two-page issuance, the following pork products will have their prices capped at the following rates: kasim/pigue, P270 per kilo; and liempo,  P300 per kilo.

It also imposed a price ceiling for dressed chicken, at P160 per kilo.

EO 124 will remain valid for 60 days upon its effectivity after its publication.

Duterte said he signed the new issuance to ensure said food items remain affordable as the country continues to reel from the economic slowdown caused by the Covid-19 pandemic.

Image credits: Nonie Reyes
Read full article on BusinessMirror

- Advertisement -
- Advertisement -

Related Articles

- Advertisement -
- Advertisement -

Latest Articles

- Advertisement -