Gov’t won’t extend QR exemption on rice — DTI

by Ian Nicolas P. Cigaral, Businessworld, Jun 28, 2017

THE PHILIPPINES will no longer extend the temporary use of quantitative restrictions (QR) on rice which will expire by end-June, the Department of Trade and Industry (DTI) said on Tuesday.

“We are not pursuing QR. It’s over. It’s been decided by NEDA (National Economic and Development Authority) in January, or even earlier,” Trade Secretary Ramon M. Lopez told reporters in a chance interview at Malacañang when asked about the government’s “next step” considering the QR’s upcoming expiration.

Mr. Lopez, as the Trade secretary, chairs the Committee on Tariff and Related Matters (CTRM) — with the director-general of the NEDA as co-chairman.

The QR is a non-tariff measure imposed by a member of the World Trade Organization (WTO) to limit the volume of imports of a particular commodity over a particular period. The regime will expire by end-June, unless the Philippines asks for another extension.

The country was allowed to impose temporary QRs on rice after the government was permitted “special treatment” for the staple grain upon acceding to the WTO in 1995. The special treatment was extended up to June 30 this year through a waiver.

During the negotiations for the second extension, which was granted in 2014, the Philippines had agreed to, among others, increase the Minimum Access Volume (MAV) to 805,200 metric tons and reduce the in-quota tariff to 35% corresponding to the Asean Trade in Goods Agreement (ATIGA) duty and a most-favored nation (MFN) rate of 40% for volumes imported outside the MAV.

Through this arrangement, the Philippines was given more time to achieve self-sufficiency in rice, a move expected to counter the damaging impact of the expected influx of cheap rice imports after the QR is scrapped.

As the QR nears its expiration, President Rodrigo R. Duterte signed Executive Order No. 23 in April extending the “effectivity” of MFN, MAV and “other Philippine commitments” relating to the waiver granted by WTO on the special treatment of rice.

Meanwhile, the Philippines is rushing to set up a tariff scheme for rice after the expiration of the QR regime, with NEDA Director-General Ernesto M. Pernia and Finance Secretary Carlos G. Dominguez recently expressing their intent to allow the scheme to lapse.

However, an official from the Department of Agriculture last year said that preparations for the tariff regime on rice will take more time because of the need to go through the legislative process.

“It takes time… Congress will still need to amend the law,” said the undersecretary for the Agriculture Department’s Planning and Policy Division Segfredo R. Serrano in an interview with reporters in December.

The required amendments involve Republic Act 8178 or the Tariffication Act of 1996 which authorizes the President to set import duties on the staple grain upon the expiry of the country’s waiver for the special treatment on rice. —