The Department of Trade and Industry (DTI) is looking at slapping a fee on sugar imports as a way to protect local farmers from the impact of a free flow of imports.
Trade and Industry Secretary Ramon Lopez said last week that they were formulating a solution that would allow free importation while at the same protect local farmers.
This followed signs that the Duterte administration will liberalize the sector, which currently restrict imports to protect farmers’ welfare.
The price of locally produced sugar, however, has become more expensive compared to imports, prompting some stakeholders to ask that restrictions on sugar imports be eased.
“There’s also one solution we are thinking of. Instead of a quota, there can be some kind of a fee. It’s like a nontariff. You could probably put a minimum fee for all importers for them to be allowed to import,” Lopez said.
Further details—such as the amount of fee—are still being fleshed out, the trade chief said, while clarifying that this plan has not been brought up yet to other cabinet officials.
The Department of Budget and Management reportedly said that a tariff of 30 to 40 percent was being considered to protect local farmers.
However, it is not clear if this also means raising the current 5-percent tariff on sugar imports from Southeast Asia, which was set to that level because of a free trade deal in the region.
The Philippines buys most of its sugar imports from Thailand and Vietnam.
Lopez acknowledged the tricky balancing act between allowing more imports and protecting sugar farmers.
“We’re treading on soft grounds here. We’re looking for a solution that’s not anticompetitive. We’re looking for a solution that will still allow anybody to import,” he said.
“[At the same time], we’re looking for a solution wherein the farmer still has protection,” he added.