Tariff cuts on pork draw mixed reactions

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    The lower tariff on imported pork may benefit consumers but will ultimately kill the local hog sector.

    This was the mixed sentiment aired by o meat traders, processors, hog raisers and legislators following the issuance last Wednesday of Executive Order (EO) 128 reducing duties on imported pork for a year.

    The duty on pork under minimum access volume (MAV) was dropped to 5 percent from 30 percent. Tariff on those outside the MAV was reduced to 15 percent from 40 percent.

    The new duties will be in in effect for the first three months from effectivity of the law, April 22 at the latest.

    For the fourth until the 12th month of the EO, tariffs are raises to 10 percent within MAV and 20 percent outside MAV.

    The Philippine Association of Meat Processors Inc. (PAMPI) said the order can be considered a “victory” for consumers who have been suffering from high pork prices due to the shortage.

    “Meat processors and legitimate importers will benefit from this landmark decision and this will allow us to bring back affordable value-added pork products to the market. We understand this reduction of duties is for all importers and we enjoin the country’s hog industry to take part as well,” said Felix Tiukinhoy Jr., PAMPI president.

    In a statement, PAMPI said if local hog raisers would consider importing , “they would be able to recover part of their losses and at the same time enable them to serve their network of pork dealers and ultimately benefit the consumers.”

    Jess Cham, president of the Meat Importers and Traders Association, concurred with PAMPI, saying the EO is a “big win” for consumers and the economy as the hospitality and catering sectors are also set to benefit from it.

    But agricultural lobby group Samahang Industriya ng Agrikultura (SINAG), said
    the EO will severely affect millions of families relying directly on the hog industry as well as the thousands of workers and businesses that provide animal health products and animal supplements including feed millers, viajeros, backyard processors, retailers and market vendors.

    SINAG said imports can plug pork shortfall at current tariffs and MAV allocation without any additional burden to importers.

    SINAG said at current tariff rates, importers can realize profits of P200 to P250 per kilogram for importers.

    “Reducing tariffs will also deprive government of much-needed revenues amounting to no less than P12 to P14 billion annually, an amount that could be utilized to finance government programs aimed at helping the livestock industry recover faster from the African swine fever outbreak,” SINAG said.

    Victorio Dimagiba, president of Laban Konsyumer Inc., said the newly- issued policy can be considered a “regulatory capture” and “anti-consumer” saying price ceilings, if implemented well, are more effective in truly bringing down prices that would directly benefit consumers.

    Senate President Vicente Sotto III said the President’s decision to lower tariffs on imported pork products spells “bad news” to the local hog raisers.

    Last month, the Senate adopted a resolution asking Duterte to reject the Department of Agriculture’s (DA) proposal to lower the tariffs and increase the MAV for pork imports.

    Senator Panfilo Lacson, who filed a resolution for the Senate to constitute itself into a Committee of the Whole for that purpose, said lawmakers cannot question the President’s authority to adjust the tariff rates while Congress in not in session.

    Congress is on summer break from March 27 to May 16.

    Lacson said the Senate Committee of the Whole is scheduled to conduct its first hearing on the issue on Monday and how such tariff cuts and the MAV allocations will impact the country’s food security as well as the foreseen revenue losses. – With Raymond Africa