An industry group fears cheap banana imports from Central America will soon gnaw into the Philippines’ share in the South Korean market.
In a statement, Pilipino Banana Growers and Exporters Association (PBGEA) president Alexander Valoria said while a small percentage of banana exports to South Korea were coming from Central American countries, “they could easily bump us off from this lucrative export market three years from now because our bananas would be more expensive…”
Currently, nearly 90 percent of South Korean’s banana imports come from the Philippines. Yet, the country’s agricultural exports face a heavy 30-percent tariff.
Meanwhile, Central American countries like Costa Rica, El Salvador, Honduras, Nicaragua and Panama have been enjoying zero tariffs.
“Unless we get the same zero-tariff treatment as these countries do, cheap banana imports from Central America could totally push us out of the picture by 2022,” PBGEA executive director Stephen Antig said.
“What we can do is to come up with a separate bilateral agreement with Korea removing the import tariff on Philippine bananas,” he added.
Philippine officials have already requested a preferential treatment for agriculture exports during President Duterte’s state visit in South Korea in May.
Agriculture Secretary Emmanuel Piñol said the proposal was to initially lower the rate to 10 percent.
Last year, South Korean exports to the Philippines amounted to $10.6 billion while Philippine exports to Korea only reached $3.7 billion—which the group described as “heavily lopsided.”
The group is calling on the government to “correct this trade imbalance” by at least getting more favorable terms for the country’s agricultural exports to the East Asian country.
“The government must assess the benefits and disadvantages of existing free trade agreements to reverse trade imbalance with bilateral or multilateral partners,” the group said.