Agriculture Secretary Edgardo J. Angara said that while government will live up to its commitments, it will replace the quantitative restrictions on rice with "appropriate" tariffs to protect local rice farmers.
"We have been asked to determine the tariffs by 2004, but we are reserving the right to do that and when we are ready to do so," Angara said, adding "we do not want to yield completely." He assured that the government will put up high tariffs in exchange for liberalizing the domestic rice market.
Angara said member countries of the ASEAN have agreed under the Common Effective Preferential Tariff (CEPT) being envisioned under the ASEAN Free Trade Area (AFTA) to put up their final tariff levels for rice by 2004.
Another wave of liberalization is expected in 2010 under the aegis of the World Trade Organization.
The liberalization of the local rice market is expected to be a sensitive issue, DA officials admitted. Being a socially-sensitive commodity like oil, opening up competition will surely elicit protests from rice farmers, who are raking in very marginal profits from rice farming.
In contrast, their counterparts in other parts of the region are heavily subsidized.
DA officials said the government can invoke the recent opt-out agreement forged in the just-concluded ASEAN Summit in Singapore wherein the 10-member countries agreed to retain tariffs on selected products.
The act was meant to give members, especially those coping with domestic political and economic woes, more time to cope and prepare for liberalization.
For one, President Estrada who faces an impeachment trial next month and Indonesian President Abdurrahman Wahid who is also being asked to resign, has sent their respective local economies to near-recession levels.
ASEAN countries are committed to the AFTA which envisions eliminating most regional tariffs in two years.
The agreement in Singapore allows members to delay the lifting of tariff on products considered needing protection. To avail of this privilege, members first have to write to the AFTA council and justify their seeking exemption.