DUTERTE’S WAY

Customs 2016 revenue target cut by a fifth

ECONOMIC managers of President Rodrigo R. Duterte have slashed the collection target for the Bureau of Customs (BoC) this year by almost a fifth amid falling oil prices and lower import volumes.

The DBCC sets the government’s official macroeconomic assumptions and fiscal program. Mr. Duterte’s economic team slashed the government’s total revenue projection to P2.573 trillion this year, coming from a P2.697-trillion target set last February due to lower than expected collections. This, in turn, is seen to yield a wider budget deficit at 2.7% of gross domestic product (GDP) at P388.87 billion compared to an earlier 2% cap.

Philippines resolved to end import restrictions for rice

THE DUTERTE administration said it remains intent in scrapping rice import restrictions that will lapse in June next year, as such non-tariff barrier clouds prospects for the Philippines’ inclusion in the Trans-Pacific Partnership (TPP) deal.

The quantitative restriction (QR) on the grain has been in place since 1995, when the country joined the World Trade Organisation, and has been extended at least twice. “Protectionist policies like QRs are hindrance to trade agreements,” Socioeconomic Planning Secretary Ernesto M. Pernia said in a text message. Asked what trade deals the Duterte administration is eyeing to enter, Mr. Pernia cited the TPP deal which “we are still looking into.” In February, the TPP, which is expected to make up 40% of the global economy, was signed by 12 member nations. It will see ratification if within two years, at least six countries -- that comprise 85% of the total gross domestic production of the 12 TPP nations -- approve to implement the final text of the deal. The 12 TPP signatories are Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, the United States and Vietnam. The Philippines, under the Aquino administration, has already expressed interest in joining the trade agreement through some consultations done as early as last year with some of the TPP signatories. “Time for competition to pressure our farmers to be more productive with government backing,” Mr. Pernia added, noting that Finance Secretary Carlos G. Dominguez who heads the economic cluster, shares the same sentiment with him. In his speech during a “Smart Agriculture Forum” at the SMX Convention Center on Thursday, the National Economic and Development Authority (NEDA) chief said the country is under an “increasing pressure to open agriculture to agricultural trade.” “It’s not good to extend... It doesn’t make us look good that we keep extending,” said Mr. Pernia, noting that there are proposals to continuously impose the QR on the “politically-charged” grain but that economic ministers “are opposing this extension.” “We hope we are not going to be prevailed over by other members of the cabinet,” he added. Agriculture Secretary Emmanuel F. Piñol, who was invited as the keynote speaker of the forum but was not present at the event, earlier expressed intent to seek a two-year extension to prepare rice farmers ahead of the influx of cheap imports. “We believe that our farmers are still not ready for the removal of the QR,” said Noel A. Padre, director of DA’s Policy Research Service who was speaking in a panel discussion on Thursday to represent Agriculture Undersecretary Policy, Planning, Research and Development and Regulations Segfredo R. Serrano. Mr. Padre added that the agency has conducted a research study where “we saw that only rice producers in Nueva Ecija are competitive with producers in rice in Vietnam, Thailand.” Manila enjoyed the QR for ten years until 2004. It was stretched to 2012 after which the country sought for a second extension which was approved by WTO country-members in 2014. The waiver is due to expire July next year. -- Janina C. Lim