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Phil. Agri Remains Sluggish
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Masipag News & Views
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Dec 04, 2001 01:10 PST
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After 7-year WTO membership
PHIL. AGRICULTURE REMAINS SLUGGISH, SAYS DA
Seven years since the Philippines signed trade accords with the World
Trade Organization, the agriculture and fisheries sector "remains a
center of poverty and stagnant productivity."
Inadequacy of government support, tardiness and lowering tariffs beyond
WTO bound commitments have caused the sector's failure "to modernize,
diversify and take advantage of existing market access opportunities,"
said the Department of Agriculture in an official position paper to the
WTO Ministerial Conference.
Despite being an anchor sector of the economy, 75% of farmers and
fisherfolk remains in poverty and output growth is less than 2% since
the 1990s, said the DA.
Agriculture has been included into the General Agreements on Tariffs and
Trade (GATT) during the Uruguay Round. The Philippines, together with
117 other member countries, signed the global trade accord in April 1994
and thereafter ratified by the Senate.
Six years tardiness
Since the country started implementing the agreements on agriculture in
1995, there has been a "virtual non-existence of the domestic support
structure," admitted the DA.
It said government is culpable of "six years tardiness" in enacting
necessary trade remedy laws on anti-dumping and other special safeguard
measures.
Of the promised P128 billion fund on physical safety nets for
infrastructures and competitiveness enhancing public investments, only
40% was complied by the government.
An average domestic support of only 4% of Gross Value Added was
implemented out of the WTO allowable 10%, the DA said.
The DA, together with other government line agencies, was part of the
Philippine negotiating team at the 4th Ministerial Conference of the WTO
in Doha, Qatar mid-November.
Some developing countries "now deemed successful in adjusting to
globalization" have laid down increased domestic support structure to
allowable limits, said the DA.
Full compliance
The agriculture department noted the Philippines registered almost full
compliance to commitments to the 142 member-country WTO.
But analysts say it has been to the country's detriment.
Quantitative Restrictions (QR), a quota set on imports, have been
slashed on corn, coffee, garlic, potato, cabbage, onion and livestock.
"It's like a death sentence for farmers involved in producing these
agricultural products," said Leopoldo Guilaran of the organic farming
network Farmer Scientist Partnership for Development.
Cheap onion from China, US, Netherlands, India and Australia swarm the
local market slowly killing the once vibrant industry of Central Luzon
where about 90,000 local populace earn a living.
Corn farmers cannot compete with imports from countries like China,
Indonesia, Brazil, India and Thailand. Market price of local corn is at
P4.00 to P4.50 per kilo as against the P3.50 imported grail.
From 1993 to 1998, corn import rose by more than 600 times from 640
metric tons to 426,000 metric tons. Recently, government announced plans
to import 230,000 metric tons.
In rice, considered a political commodity in rice-eating countries like
the Philippines, a QR is maintained. Minimum requirement on rice import
is set at 1% (one per cent) of total consumption but has to be increased
to three percent until year 2004.
Last year, the country shipped in 660,000 metric tons, 10 times bigger
than 1994 volume. In 1999, it imported 800,000 metric tons which
resulted to oversupply and led to a sharp decline of farmgate prices of
locally-produced palay, according to the independent economic think-tank
Ibon Databank.
Already, an estimated 700,000 Filipinos have been displaced by the
global trading scheme since 1995.
Deceptive and sufficiently ambiguous
The DA is also skeptical of the Special and Differential Treatment
provision for developing countries.
Except from differentiation in the market access schedule of
commitments, "the rest are either deceptive and/or 'sufficiently
ambiguous' in language architecture," said the DA.
Developed countries are required to reduce their overall level of
support by 20% and developing countries are 'allowed' 10% of the gross
value of agricultural production in trade distorting support.
"Alternatively stated, this means that developed countries are allowed
to keep 80% of their already high levels of support while developing
countries are limited to 10%," said the DA.
Reduction of government support to local production is deemed necessary
to place global trading members in "equal footing."
Poor and developing member countries however accuse the US and EU of
"unfair trade practice" by excluding other forms of support only
developed countries can provide like direct income payments of the US
and compensation payments of the EU.
"Developed countries were expected to reduce domestic support and export
subsidies after the Uruguay Round," said the DA. "This did happen in
1996 to 1998, but the downward trend was totally reversed beginning 1999
on the run-up to the Seattle Ministerial conference and continue to
approach pre-UR levels."
The Organization for Economic Cooperation and Development, where the US
and EU are leading members, "currently spends an estimated US$1 billion
per day in agricultural support and continue to pollute the
international trading environment with distortions," said the DA.
Tight security
The five-day Ministerial Conference concluded on Nov. 13 in Doha under
tight security and restricted access of civil society groupings.
In 1999, it was abruptly dismissed in Seattle amid protests of tens of
thousands global citizens and widening division between rich and poor
member nations. (MNV)
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