What Philippines gave up with the recent enactment of rice trade liberalization law

THE Philippines has given up its right to impose the most effective protection against import surges of farm products when it enacted the rice trade liberalization (RTL) law, according to a highranking official.

Agriculture Undersecretary Segfredo R. Serrano said Republic Act 11203 included a provision that removed the government’s authority to reimpose import restrictions in times that import surge cause harm or injury to the local agriculture sector.

“[Reimposing quantitative restriction (QR) as a general safeguard] is useless now since it became a collateral damage when the rice trade liberalization law was enacted,” Serrano told reporters in an interview on Tuesday afternoon.

“We have lost one elbow room in protecting the local industry. If you invoke Republic Act 8800, you have the option to impose a temporary or a tenured QR to stem prejudice or damage to the industry, and it is a very effective measure,” Serrano added.

Serrano cited Section 3 of the RTL law as the provision that effectively amended the provisions of RA 8800 or the Special Safeguards Act that allow the government to reinstate QR as a protective measure in times of detrimental import surge proven to be detrimental to a domestic sector.

Section 3 of the RTL law amended Section 4 of RA 8178 or the Agricultural Tariffications Act to read as follows:

“The following laws and all other laws or provisions of law prescribing quantitative import restrictions or granting government agencies the power to impose such restrictions on agricultural products or hindering the liberalization of the importation, exportation and trading of rice are hereby repealed.” Disarmament

DUE to this, the government could no longer impose QR anymore as a trade remedy on the reported surge in palm oil imports, which Agriculture Secretary Emmanuel F. Piñol said has caused oversupply in the local market, thus, pulling down the farm-gate price of copra to below cost-to-produce levels.

Likewise, the government could not invoke such right if the volume of rice imported in the country under the new trade regime would reach a level that would drastically affect local farmers.

“That’s the biggest whammy on the agriculture sector. What gives the teeth to being able to prove the causality between the import surge and price decline…is the ability and flexibility to apply QR on a tenured basis,” Serrano said.

“This is a unilateral disarmament on the agriculture sector. We cannot reimpose QR on agriculture, but we could still do it in industrials. So what does that tell us?” he added.

Serrano said they vehemently opposed the provision but to no avail. Deaf ears

FEDER ATION of Free Farmers Inc. (FFF) National Manager Raul Q. Montemayor said they flagged the consequences of the RA 11203’s Section 3 to lawmakers and even to the Malacañang but it fell on deaf ears.

“I think they did not know or understand what this was all about,” Montemayor told the BusinessMirror. “Or maybe they thought that the special safeguard (SSG) provision in Section 10 of RA 11203 was sufficient or was what we were talking about.”

Due to the removal of the authority to reimpose QR, the government has been left with only the option to increase tariffs on farm imports if it proves that imports have caused harm to local industries.

“If SSG proves to be insufficient to address a surge in imports and decline in palay prices, the general safeguards under RA 8800 could be a fall back position of the government. But RA 11203 seems to have taken out this option,” he said.

Montemayor said they have proposed that the Section 3 of RA 11203 to be clarified in the law’s implementing rules and regulations (IRR) so as not to leave the government helpless in protecting the local farmers.

Montemayor added they are hopeful that Piñol would insist on fixing the provision.

“During the IRR consultation in Iloilo, I flagged this concern and suggested that a phrase be added in the IRR to say “except as provided under RA 8800 and WTO rules,” he said.

“Otherwise, it would be difficult because importers might use the RA 11203 to challenge the imposition of QRs under RA 8800,” he added.

The World Trade Organization allows the reimposition of QRs and increased of tariffs given that the import surge was proven harmful to a country’s domestic sector.

“A WTO member may take a safeguard action (i.e., restrict imports of a product temporarily) only if the increased imports of the product are found to be causing, or threatening to cause, serious injury,” according to the WTO.