TO GROW the entire agriculture sector and help farmers and fisherfolk, much more attention must be given to the service sector that accounts for a hefty 57 percent of our gross domestic product (GDP).
This is because service impacts agriculture significantly.
When some truckers and shippers abused their powers by increasing prices to unjustified levels during our recent port congestion, the Alyansa Agrikultura (AA) asked them to charge more reasonable prices.
Though some responded well, the recalcitrant ones didn’t. Consequently, at a joint Senate committee hearing last year chaired by Senators Bam Aquino and Chiz Escudero, AA requested the Department of Trade and Industry (DTI) to look into this problem. Since I helped in the formulation of the Consumer Act and Price Act legislation when I was DTI undersecretary, I knew that DTI could use its broad mandate to get involved in this area.
Truckers
At the April 30 meeting jointly called by the DTI and the Land Transportation and Franchising Regulatory Board (LTFRB), AA objected to a government proposal that they would publish the new trucking rates of the Confederation of Truckers Association of the Philippines (CTAP). This is because the CTAP said that they decreased their rates by 10 percent from a year earlier.
With the help of Emma Mijares of the Export Development Council, AA pointed out that the cited rate a year earlier was for the peak months of the port congestion. The comparable rate should instead be the rate before port congestion.
AA therefore asked for a day to meet with truckers, importers and exporters at the LTFRB office. AA then presented the figures gathered from the three latest CTAP rate publications.
Dates CTAP Rates for a 20-Footer
Las Pinas Muntinlupa Caloocan City (beyond Edsa)
Using pre-congestion 2011 rates, there was a 50 percent increase in 2014. While there was an 11-percent decrease from 2014 to 2015, the 2015 rates are still 35 percent higher than the 2011 pre-congestion rates.
Furthermore, the representatives from three truckers associations (i.e. CTAP, ACTOO, and INTA) reported that the existing rate for Las Piñas and Muntinlupa was much lower than the CTAP published rate of P16,875. For import cargo, current rates generally ranged from P11,000 to P12,000, with the highest rate of P13,000 reported by a representative from the Filipino-Chinese Chamber of Commerce.
With this information, the truckers, importers and exporters unanimously recommended that the LTFRB refrain from publishing the high rates stipulated in the CTAP circular. The LTFRB agreed. What remained problematic was the CTAP circular to its members that stated: “Resolved to adopt the attached hauling rates as the official guiding rates. No quotation should be lower than the attached rates.”
When AA told newly elected CTAP president Edgardo Olego that this was price fixing and cartel behavior, Olego immediately wrote the CTAP officials the following: “Please note that the phrase—no quotation should be lower than the attached rates—is not applicable and must be deleted. Instead, all members are free to submit their quotes and negotiate with their clients for reasonable and competitive trucking rates.”
The agricultural produce can then be transported at reasonable rates and remain competitive, thus saving precious agricultural jobs.
Shipping lines
AA argued in a Senate hearing last year that DTI should use its broad mandate of promoting fair trade practices to look at excessive charges of some shipping lines and possibly charge the guilty ones of profiteering. In the law, profiteering is defined as charging a price for a product that is grossly in excess of its intrinsic value.
Last April 30, after the meeting among the farmers, importers and exporters, the DTI took a proactive approach and released to media the following statements:
1) The DTI will look into the component of the shipping charges and utilize the public-private partnership model.
2) On the issue of regulating shipping line charges, the DTI will submit a proposal for Marina to study the legal basis for regulating shipping charges of international shipping lines. This submission was done last May 7.
At the May 17 Apec preparatory meeting in Boracay where AA was an active participant, the Philippines took the lead in advocating that the service sector, including logistics, should be a new major Apec focus. The government side of Apec was led by Undersecretary Laura del Rosario, while the Apec Business Advisory Council was chaired by Magsaysay Group of Companies president Doris Magsaysay-Ho (also chair of the Philippine Corn Board).
In a following commentary, we will discuss the important role that the service sector plays in agriculture development and inclusive growth. This is the admirable thrust which the Philippines is spearheading when we chair the 20-nation Apec meeting in November 2015. This is why farmers should assertively engage not only truckers and shippers, but also the different players in the service sector that significantly impact farmers’ lives.
(The author is chair of Agriwatch, former Secretary for Presidential Flagship Programs and Projects, and former Undersecretary for Agriculture, Trade and Industry. For inquiries and suggestions, email agriwatch_phil@yahoo.com or telefax (02) 8522112).
CTAP Rates for a 20-Footer
Dates Las Piñas and Muntinlupa Caloocan City (Beyond Edsa)
Jan. 15, 2011 P12,500 P9,200
Mar. 15, 2014 18,750 13,800
Apr. 16, 2015 16,875 12,420