Bitter truths and sweet lies?

Axiomatic. President Marcos Jr., in a recent statement, reiterated that transparency and accountability are unquestionably the cornerstones of his governance. As someone with professional and personal dealings with PBBM, I have faith in his anti-corruption stand. Unfortunately, controversies continue to erupt under his watch as concurrent Department of Agriculture secretary, which undermines his good governance policy. Like the artificial red onion crisis, the sugar importation mess has become more odious and malodorous since it unraveled in July.

Sugar Order No. (SO) 6

The entry of some 450,000 metric tons (MT) of imported sugar in our country before the Sugar Regulatory Administration (SRA) could issue SO 6 has fanned the flames of the importation brouhaha.

Has sugar smuggling become a state-organized criminal activity as alleged by an opposition senator? Can a memorandum order from the Office of the President supplant a sugar order from the Sugar Regulatory Administration (SRA)? Is the importation aboveboard as DA Senior Undersecretary Domingo Panganiban avers?

I believe that Mr. Panganiban, who also chairs the SRA, should be able to address the accusation of Senator Risa Hontiveros in a legislative investigation. After all, he recommended to PBBM the importation of 100,000 MT of domestic sugar (classified “B”) and 350,000 MT tons of reserved sugar (classified “C”). It served as the basis for Executive Secretary (ES) Lucas Bersamin’s memorandum order authorizing the importation under the 2nd Sugar Import Program for Crop Year 2022-2023.

Panganiban, who is not a lawyer, interpreted the Bersamin memorandum as a sugar order. I disagree. Only the SRA Board is vested with the legal power to issue a valid importation order. My former student and current ES Undersecretary Leonardo Cervantes informed me that they are still studying the legal implications of the issue.

Likewise, I find dubious the sequence of events leading to the SO 6 issuance. I have seen the letters of importers Sucden Philippines and Edison Lee Marketing Corporation addressed to the President through House Speaker Martin Romualdez.

In its Jan. 11 letter, Sucden stated: “…we would like to recommend that your office authorize the importation of 100,000 MT by Sucden Philippines to be classified as ‘C’ sugar. Sucden Philippines would import the sugar from February 1, 2023, to August 31, 2023.”

Meanwhile, the undated letter from Edison Lee Marketing requested: “We would like to apply to import 100,000 metric tons of sugar in the next 30 to 60 days to be classified as ‘C’ sugar.”

On Jan. 13, the ES memo instructed the DA to implement the recommendations to ensure adequate supply in the market, reduce prices and manage inflation in consonance with the Sugarcane Industry Development Act of 2015.

On the same day, USec Panganiban sent a letter to Edison Lee Marketing authorizing the company to import sugar as stipulated in its request letter and per the instruction of ES Bersamin. I do not have a copy of Panganiban’s letter to Sucden and another accredited importer, All Asia Countertrade. At a media briefing, he admitted to instructing three capable companies to proceed with the importation.

On Feb. 9, imported sugar entered the Batangas Port. Panganiban said PBBM was properly informed about the matter.

The SRA released SO 6 on Feb. 15 and filed it before the Office of the National Administrative Register (ONAR) of the UP Law Center. All government issuances registered at ONAR would become effective after three days.

Under Section 7 of SO 6: “The SRA Regulation Departments in Quezon City and Bacolod City shall begin accepting applications and requirements under this Sugar Import Program from the date of the effectivity of this order, for five (5) calendar days.”

There was a clear breach in the process of selection and awarding of allocation to eligible importers. Based on the timeline, Sucden, Edison Lee Marketing and All Asia were pre-selected as early as January.

According to SO 6, the imported sugar from Thailand should only reach our shores by March 1 at the earliest.

P800 million in kickback?

The imported sugar is equivalent to 8 million bags. In an exposee last year, Senate President Juan Miguel Zubiri disclosed that every bag has a “tongpats” (kickback) of as high as P100. It means corrupt government personnel could earn P800 million from this deal.

Ironically, we are once again importing sugar during the sugar cane harvest season, which ends in May or June. The situation has a sense of déjà vu but of the worse kind. It is a repeat of last year’s SO 4 fiasco, which directed sugar importation a month before the country’s milling season. Sugar cane farmers, migrant farm workers and legitimate traders would have dealt with huge income loss and livelihood destruction had imported sugar flooded the market.

Ever since the sugar controversy broke out, I have been critical of the discretion or lack thereof of agriculture officials. I thought they would have learned from the previous fiasco, which led to the suspension or resignation of several agriculture executives. Last January, the OP absolved four DA and SRA officials of any liability. It also led to the parting of ways between the President and close ally Vic Rodriguez, who briefly served as ES, in September. Thankfully, PBBM listened to public opinion and rescinded the order.

I am not accusing the Undersecretary of anything. Let me be clear on that. In the past, I repeatedly reached out to Mr. Panganiban so he could shed light on sugar-related issues to no avail. It would be in the best interest of the sugar industry stakeholders, specifically the farmers and consumers, if he clears up this issue in a proper forum. Between the bitterest truth and the sweetest lie, the former is the wiser option for a public inquiry.