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Senators win concessions as deal reached with gov't on pork imports
Meat stalls are empty at the Trabajo Market in Sampaloc, Manila as vendors take part in a pork holiday last February 8, the first day of a price ceiling imposition for pork and chicken in Metro Manila.
The STAR/Edd Gumban

Senators win concessions as deal reached with gov't on pork imports

Christian Deiparine (Philstar.com) - May 5, 2021 - 9:59pm

MANILA, Philippines (UPDATE 9 a.m., May 6) — Senators and economic managers on Wednesday finally struck a compromise on pork imports that the Duterte administration saw as a critical band aid fix to rising prices, but which lawmakers considered as a potential killer of the local pigs sector.

Following grueling talks among key officials, a deal was reached to increase the minimum access volume for pork to 254,210 metric tons from the original 54,000 MT, Agriculture Secretary William Dar said in a statement.

In terms of tariffs, those coming in within the quota will get charged 10% for the first 3 months that will increase to 15% in succeeding 9 months. Outside the limit, levies were set at 20% and 25% during the respective periods.

In the process, both sides have won concessions that in the past seemed impossible to get. Senators were amenable to a MAV increase but not toward a hefty 400,000 MT that the government initially laid out. Legislators were also objecting to a dramatic cut in tariffs that under normal times are pegged as high as 40% over fears it would trigger a deluge of cheaper imports that will kill the swine sector.

At the same time however, the Duterte government argued that a combo of lower tariffs and higher pork imports was necessary to arrest a spike in pork costs, which in April became the single largest driver of inflation. In that month alone, pork inflation climbed an average of 57% year-on-year as supplies have failed to recover from the damage of the African swine fever (ASF).

“This is an urgent short-term measure,” Dar said in a statement. “We are still aggressively taking steps to help the domestic industry recover from ASF.”

“We appreciate the quick resolution of this issue. A problem of this scale, especially when incomes and job opportunities have declined, needs immediate and urgent action,” the agriculture chief said.

The agreement cannot be immediately implemented though. The National Economic and Development Authority (NEDA) was tasked to draft an executive order containing the agreed provisions for President Rodrigo Duterte’s signature. The EO would still have to be published before taking effect.

The entire process can take days at the very least, and while it is unfolding, the original EO 128 which senators have opposed will remain in effect. The Bureau of Customs, which monitors trade borders, earlier said it had started charging lower tariffs down to 5%, although existing imports quantities had not been adjusted upwards yet.

EO 128 was issued last month while Congress was on break, and immediately, senators convened as a body to pass a resolution condemning Duterte's order. That rare show of resistance matters since under the law, the two chambers of Congress may overturn EO's on tariffs by simply passing a resolution. The Lower House has not followed Senate's lead.

That said, whether or not the deal would lead to just enough pork shipments to replenish supplies while keeping local producers competitive remains uncertain. It is indeed a tough balancing act, something that had been obvious during fiery Senate hearings that saw economic managers led by Finance Secretary Carlos Dominguez III butted heads even with some of Duterte’s trusted allies in the chamber.

Politically, the deal also marked one of the few times that the Duterte's economic team accepted concessions to push a policy forward. In other remarkable instances, including the cost of pandemic stimulus, Dominguez, Socioeconomic Planning Secretary Karl Kendrick Chua and Budget Secretary Wendel Avisado have stood their ground despite clear resistance from some senators.

For NEDA's Chua, anything except the status quo is acceptable. “Meat has been persistently the top contributor to inflation this year, hence we urgently need to temporarily augment our pork supply through importation,” he said in a separate statement.

“Retaining the status quo will cause 100 million Filipinos to suffer longer from high food prices,” he added.

 

Editor's note: Added details about EO 128 and senators' resolution

AFRICAN SWINE FEVER DEPARTMENT OF AGRICULTURE PHILIPPINE INFLATION RODRIGO DUTERTE SENATE OF THE PHILIPPINES
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