SIAP confident carrageenan will make it to US GSP list this year

The Seaweed Industry Association of the Philippines (SIAP) is bullish about its prospects of getting carrageenan included in this year’s list of product covered by the US Generalized System of Preferences (GSP). Inclusion in the GSP list will cut the existing five-percent tariff on manufactured carrageenan to zero.

"We are quite confident that carrageenan will be included in the list of US GSP based on the original purpose of GSP which is to give opportunities to developing countries to develop their agricultural products like carrageenan," Pete Bora, spokesperson of SIAP.

Borja said the chances of carrageenan being included in the GSP list also got a big boost with the Bush administration dangling the privilege to countries supportive of its crusade against terrorism, especially its planned assault against Iraq.

Earlier, SIAP president Benson Dakay said local seaweed exporters are processing documents required by the Washington-based US Trade Representative Office (USTRO) for specific industries that want to qualify for the GSP.

Dakay said SIAP is confident about carrageenan’s inclusion in the GSP list considering that the USTRO has expressed its preference for just two agriculture products – tuna and carrageenan.

Aside from this, Philippines seaweed exporters’ lone rival is Denmark. But since the GSP is granted to countries supporting the US’ crusade against terrorism, especially against its planned assault on Iraq, Dakay said SIAP has the upper hand over Denmark.

The two products should have been submitted by the Bureau of International Trade Relations (BITR) to USTRO last year but the tuna industry asked for a postponement, pending the completion of its documents, while the SIAP was snarled by other reasons.

Inclusion in the GSP list will bring down the 10-to-30 percent tariff on canned tuna to just five percent while the existing five- percent tariff on manufactured carrageenan will go down to zero.

Dakay said SIAP will be emphasizing the economic impact of being eligible for the GSP.

"We have to stress how the petition will further the economic development in the seaweed-producing areas, especially in the Muslim areas, specifically the Zamboanga-Jolo Basilan, Tawi-tawi corridor," said Dakay.

SIAP was advised by USTRO representatives to hire US-based lobbyists but this costly proposal was turned down by local seaweed manufacturers.

Instead, Dakay said SIAP will be commissioning its old network of lobbyists led by Dr. Harris Bixler who last year successfully thwarted an attempt by Dr. Joanne Tobacman, a researcher at the University of Iowa, Department of Internal Medicine, to come out with a study showing that increased intake of carrageenan increased incidence of breast cancer.

The GSP eligibility is expected to generate bigger exports of refined and semi-refined carrageenan which averages $98 million annually.

Carrageenan is derived from raw seaweeds and is used for various applications such as gelling, thickening, or binding agents in pet food, air freshener, gels, meat, poultry, dairy, cheese, choco milk, jellies, flans, sauces, puddings, and specialty products such as toothpaste and shampoo, and lately, soft and hard capsules to coat medicines.