Philippine Rice and the World Trade Organization

Extension of RP’s QR on Rice Under Review

The Philippine government is now evaluating the possibility of petitioning the World Trade Organization (WTO) for the extension of the quantitative restriction (QR) on rice which will expire in 2012.

An official of the Department of Agriculture privy to WTO matters said discussions on the matter among concerned government agencies will soon go into high gear.

“We have not made a decision on whether we will ask for an extension of the QR. [The QR extension] is currently being discussed,” said the official who spoke on condition of anonymity.

The QR has allowed the Philippines to limit the volume of rice that can be imported by the government every year, preventing a possible influx of cheap rice imports.

In exchange for extending the QR until 2012, the Philippines agreed to increase its minimum access volume (MAV) for rice to 350,000 metric tons (MT) as a concession. The Philippines also reduced tariffs on rice to 40 percent, from 50 percent in 2007.

MAV refers to the minimum volume of farm produce allowed to enter into the Philippines at reduced tariffs.

The Philippines filed its intention to extend the QR on rice in March 2004 as it was set to expire in June 2005. Extensive negotiations for it followed, with Manila holding discussions with nine countries which signified their intention to negotiate the request.

Manila had to conduct bilateral negotiations with nine WTO members, namely, the US, China, India, Argentina, Pakistan, Egypt, Canada, Australia and Thailand.

The Philippines obtained formal approval from the WTO to extend the QR in December 2006.

The government pushed for the extension of the QR, citing the need to prepare Filipino farmers for international trade and to achieve rice self-sufficiency.

The Philippines had originally targeted to achieve rice self-sufficiency by 2010. The government was forced to move its target to 2013 due to lack of funding and the challenges posed by climate change.

Meanwhile, Rice Watch Action Network (R1) called on the government not to consider scrapping the QR on rice by 2012. “The government’s target is to achieve rice self-sufficiency by 2013. If the QR will be removed by 2012, it will pose significant problems to Filipino rice farmers,” said R1 lead convener Jessica Reyes-Cantos.

Cantos said government officials should consider a number of factors before they finally decide to liberalize rice trade. “For one, they have to consider the challenges posed by climate change. Also, they must examine its impact on the income of farmers,” she said.

The Philippines has become a major importer of rice in recent years. This year Manila is expected to import as much as 2.4 million metric tons of rice from various sources.

Manila is also in discussion with Thailand for the importation of around 300,000 MT of rice under the Asean Free-Trade Area scheme.

By Business Mirror

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