RP drops tuna, carrageenan from products for inclusion in US GSP

The Philippine government has dropped tuna and carrageenan from the list of Generalized Systems of Preference (GSP) items submitted for approval to the Washington-based US Trade Representative Office (USTR) in exchange for the country’s support to the US plan to declare war with Iraq.

Tuna and carrageenan were supposed to be included in the original GSP list submitted to the USTR but the Bureau of International Trade Relations (BITR), an agency attached to the Depatment of Trade and Industry (DTI) which consolidated all items aspiring to get GSP status said, the submission of requirement for the two products came too late. The deadline was last September.

The next deadline for new items to be included in the GSP list is in June 2003.

Sources said more than being late, talks bogged down between the USTR and BITR after representatives of the former said point blank that getting approval for carrageenan in particular, would be difficult unless pollution charges against US seaweed processor FMC Marine Colloids are dropped.

FMC’s local units, FMC Marine Colloids Phils. Inc. based in Cebu has pending pollution cases still unresolved by the Pollution Adjudication Board (PAB) even after hearings were completed last month.

"It was clear that there was pressure by the US representatives, they dangled the inclusion of carrageenan in the GSP list but the price was for Philippine authorities to abandon the pollution charges levied on FMC’, the sources said.

FMC was accused by local residents of Barangay Looc in Mandaue and the Seaweed Industry Association of the Philippines (SIAP) of continually discharging untreated wastewater into the Mactan Channel where many seaweed farms have sprouted.

Ironnically, not only the likes of local seaweed processor Shemberg Marketing Corp., got blocked in their attempt to increase carageenan exports to the US.

"By not including carrageenan in the GSP list, even FMC’s shipments to the US won’t get the perks that come with the GSP. Aside from FMC, another American seaweed processor, CP Kelco Philippines will be affected," the sources said.

On the other hand, tuna was also not included in the GSP list for this year because the USTR only wanted pouched tuna to be allowed into the huge US market. Currently, not one of the tuna exporters have existing facilities that will allow them to shift manufacturing to pouched tuna from canned tuna.

Had the two products been included in the GSP list, the 10 to 30 percent tariff on canned tuna will be lowered to 5 percent while the existing 5 percent tariff on manufactured carrageenan wil go down to zero.

The Philippine tuna industry is looking at the US GSP as a means to gain increased market access for its canned tuna exports to the US, and to cushion the adverse impact of the grant of duty free treatment to Andean tuna in pouches.