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Economy

Palace asks Senate to give pork tariff EO a chance

PRESIDENT Rodrigo R. Duterte has asked the Senate to give his executive order (EO) lowering tariffs on imported pork a chance to stabilize the supply of pork after the drastic reduction in hog numbers due to the African Swine Fever (ASF) outbreak.

Mr. Duterte is “asking the esteemed members of the Senate to give EO 128 a chance and consider its intended effects, which include addressing the shortage (of pork), stabilizing prices… and minimizing inflation,” the President’s spokesman Herminio L. Roque, Jr. said in a statement Wednesday.

The Senate has adopted a resolution asking the President to revoke his order, which temporarily reduces the tariff rates on imported pork products for one year, arguing that the surge in imports could kill the hog industry.

EO 128 reduces the tariff charged on pork imports within the minimum access volume (MAV) quota to 5% in the first three months. The rate increases to 10% in the subsequent nine months.

Pork imports outside the quota, meanwhile, will be charged 15% for the first three months, rising to 20% in the succeeding nine months.

Mr. Roque urged senators to revisit the order after two months “to assess whether the intended effects have been realized.”

He said the administration as well as the Senate wants to ensure “the recovery of the swine industry and the attainment of sufficient domestic pork production.”

Should Congress pass another bill changing the import duties on pork, “the President may veto any particular item or items in such appropriation, revenue, or tariff bill,” Mr. Roque has said.

The government should have consulted hog raisers extensively in the run-up to the EO, Samahang Industriya ng Agrikultura Executive Director Jayson H. Cainglet said.

Sana bago ‘yung appeal, pinagbigyan din muna ni (Agriculture) Secretary (William D.) Dar ang industry to recover and explain that it’s not necessary to lower pork tariffs (Before appealing to the Senate, I wish the government, through Mr. Dar, had given the industry space to recover),” he told BusinessWorld via Viber.

Mr. Cainglet said the Department of Agriculture has responded poorly to ASF.

Matagal na ang ASF, at matagal na dapat ipatupad ang border controls. Pero mukhang importation talaga ang focus ni Dar (ASF has been around for some time and border controls should have been imposed, but Mr. Dar seems to be focused on imports),” he said.

“We squarely blame Dar for our situation right now,” Mr. Cainglet said.

“The Senate has no choice since the reduced tariff rates and the increased in-quota MAV have already taken effect,” Senator Panfilo M. Lacson said in a statement.

Senator Franklin M. Drilon has said the Congress through a joint resolution was authorized to terminate any order that would “increase, reduce or remove existing rates of import duty,” citing Republic Act No. 10863 or the Customs Modernization and Tariff Act.

Mr. Lacson said senators could have given their input based on their consultations and research had the government conducted a courtesy consultation. He reiterated that the order “is a consequence of a delegated authority granted by Congress to the President.”

He said the economic team’s conclusion that the demand for pork has not changed during the pandemic is “flawed.”

He said the decline in international tourist traffic should have affected pork demand.

“As I had pointed out during the Senate Committee of the Whole hearing, the 50% contraction registered by hotel and restaurant operations should (show up in) demand since the pre-pandemic 8.2 million foreign tourists are now eating pork somewhere else,” he said.

“Thus, at 15 kilograms of pork consumption per capita as estimated would mean 120 million kilograms less pork,” Mr. Lacson said. “That should be substantial enough to consider when they came up with the 350,000,000 kilograms in additional in-quota MAV allocation.”

Mr. Lacson said the Palace appeal should have also been “directed toward the 80,000 backyard hog raisers, their families, farm hands and all others now being affected by the EO, both directly and indirectly.”

Senate Minority Leader Juan Miguel F. Zubiri said Monday that the Senate is willing to negotiate with the President over the recall of his order. — Kyle Aristophere T. Atienza

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