Economic managers open to discussing planned sugar liberalization with lawmakers

The head of the government’s economic team has expressed willingness to sit down with lawmakers to discuss more thoroughly the proposed liberalization of the sugar industry amid the growing opposition against the measure.

In an interview, Finance Secretary Carlos Dominguez said the DOF would abide by the Senate’s wish for an investigation to be made on the proposed deregulation of sugar imports and its impact on farmers and stakeholders.

“We will respect the desire of the Senate to discuss this at length. I think it’s the right move,” Dominguez said.

Economic managers are pushing for the lifting of sugar import restrictions to push down the price of the commodity and to improve the competitiveness of the country’s food manufacturing sector.

“You see, the situation in the sugar industry, our population has really grown. It’s already at 105 million at least, and we’ve seen in these last two to three years, always, there’s a shortage and the domestic prices are double the world market,” the finance chief said.

However, members of the Senate last week passed Resolution 213 urging the executive branch to scrap this policy as it could be “disastrous” to the sugar industry.

“This proposal of the economic managers is actually contradicting the thrust of our President Duterte towards food security and sustainable Philippine agriculture,” Senate Minority Leader Juan Miguel Zubiri said in a statement.

The resolution also urged the appropriate Senate committee to conduct an investigation into the measure.

The National Economic and Development Authority (NEDA), meanwhile, is set to conduct a study on the impact of the proposal.

Aside from the deregulation of sugar trade, Dominguez said he is also pushing for the review of Republic Act 809 which sets the sharing scheme of sugar output between farmers and millers.

“I told Sen. Zubiri that the other problem is the legislation that regulates the relationship between the planter and the mill. The law says the planter gets between 60 to 70 percent share of the crop and the mill gets between 30 to 40 percent of this crop, it really depends on the area,” the secretary said.

“Because of that, the mills have no incentive to put capital expenditures to improve the efficiency of their mill,” he added.

Dominguez said legislators should look into the proper sharing system between planters and mills so that the latter would be encouraged to invest in productivity-enhancing technologies.

“We should also think about a new kind of relationship between a mill and the planter so that the mill is also incentivized to be more efficient, so they will spend for the necessary technology and the capital to extract more sugar from the cane,” he said.

On Zubiri’s proposal to halt the exportation of sugar to the US, Dominguez said this should be up to the Sugar Regulatory Administration which is in charge of allocating sugar stocks for local consumption and the world market.

“I think if everybody sits down, (it) would be reasonable, I think we can arrive at a good solution, basically improving yields from the farm and yields from the mill, and satisfying the local demand and possibly even exporting and being competitive worldwide,” the finance chief said.