February 2, 2010
Philippine pork group pushes for tariff cuts delay
Members of the National Federation of Hog Farmers Inc. (NFHFI) on Sunday (Jan 31) warned that backyard raisers could go out of business if the tariff cut for pork products under the AFTA-CEPT (Asean Free Trade Agreement - Common Preferential Tariff) scheme proceeds, as local businessmen want.
Under the terms of the agreement, the Philippines is supposed to bring down tariffs for pork to between 0% and 5% by next year. The current AFTA-CEPT tariffs for fresh, chilled or frozen pork is at a uniform rate of 20%.
"We will campaign for the delay in the reduction of tariffs for pork under AFTA-CEPT. The local pork industry will suffer a huge setback if tariffs for pork traded within AFTA go down to zero," said NFHFI president Albert Lim Jr.
The tariff cut under Afta will serve as a triple whammy for hog raisers beset with problems ranging from various hog diseases to high production costs. Due to high production costs and the onslaught of diseases, around 30% of backyard raisers in Luzon went out of business last year.
In a report released by the Foreign Agricultural Service (FAS) of the USDA, no Asean country served as a major source of imported pork products for the Philippines last year. The Philippines imported a total of 109.36 million kilogrammes of pork last year.
But pork producers are apprehensive that with the reduction in tariffs to zero, pork products from Southeast Asian nations such as Vietnam could become more attractive to end-users like meat processors.
Lim said Agriculture Secretary Arthur Yap is "agreeable" to pushing for the delay in tariff reduction under AFTA-CEPT, but the proposal for the delay in tariff cuts would entail negotiations, and it is not clear what the Philippines could offer in exchange for it. Hog raisers and poultry growers were among the stakeholders who first raised the difficulties presented by the possible reduction of tariffs to their industries. Appeals to delay the tariff reduction under the AFTA-CEPT are expected to become more urgent as 2010 looms.
AFTA is a trading agreement originally signed by six Asean members - Brunei, Indonesia, Malaysia, the Philippines, Singapore and Thailand - in 1992.
The free-trade arrangement seeks to increase Asean's competitive edge as production base in the world market through the elimination of tariffs and non-tariff barriers.
