The Philippine Association of Flour Millers (Pafmil) warned the government last week of potential repercussions on the local agriculture and manufacturing industries and more importantly, on the country’s food security, should Turkey be allowed to continue “dumping” its flour products in the Philippines.
In an opening statement during the Tariff Commission hearing last week, Pafmil executive director Ric M. Pinca stressed the need to impose antidumping duties on the cheap Turkish flour imports, which threatened the existence of the Philippine wheat flour milling industry.
In just four years, the market share of Turkish flour exporters grew to 9 percent in 2012 from only 1 percent in 2008.
Pinca also pointed out that this issue has already become a food security matter as well.
“As we, local millers, lose more market share to the cheap, dumped Turkish flour, we might see this country become dependent on a food source that imports what is has to export. And it imports from Russia, a country that just embargoes its wheat exports when it needs to, with total disregard for other nations, or contracts and other commitments,” he warned.
The Pafmil official also called on the Tariff Commission to examine the issue from a government policy viewpoint.
“Not everything that is cheap is good, and not everything that is cheap is good for the Philippines. The Philippines cannot just allow the entry of foreign goods because it is cheap. Doing so, would lead to the decimation of local manufacturing and agriculture, among others,” Pinca explained.
“We have so many examples around of industries gone for their inability to compete with foreign competition. [Filipinos] need jobs that local industries cannot provide if foreign goods that are dumped and smuggled are allowed in just because they are cheap. This is why we are against dumping. This is why we are against smuggling. This is why we are against all forms of unfair trade,” Pinca said.
Pinca clarified that the move to have additional duties slapped on Turkish flour imports was not meant to impede competition, but rather to make it fair, wherein all players are given equal opportunities and a level playing field.
“We have in this country flour from Indonesia, Vietnam, Australia and even India. But Pafmil never raised the issue of dumping nor safeguards or countervailing duties. Neither did we seek any other modicum of protection against these products because the exporters are not dumping their flour in the Philippines. They play fair,” Pinca explained.
“It is in this spirit of fair play that we welcome foreign competition. Their presence keeps us on our toes, forces us to be efficient, makes us reach out more to our markets more effectively,” he further stressed.
It was last year that Pafmil sought for an increase in the tariff on Turkish flour as it claimed that Turkish flour millers were exporting flour to the Philippines “at dumping prices which is in violation of World Trade Organization rules.”
Dumping is defined as the export of a product to a foreign market at prices that are lower than the prices prevailing in the home market.
It was only in April this year that the Department of Agriculture, in its preliminary determination, affirmed in its findings that there is dumping, and had recommended the imposition of a provisional duty of 35 percent on hard flour, 39.26 percent on biscuit bread, and 35.21 percent on soft flour.
These duties, which are being imposed on top of the existing 7 percent import duty on flour, would be in effect while the Tariff Commission determines whether these rates should be made permanent.