RP to push for uniform tariff cuts with Japan

The Philippines will continue to push for a uniform tariff reduction program for agricultural and industrial products when it resumes its bilateral free trade talks with Japan next month.

"Hopefully, we could convince the Japanese government to agree to have a single format for the reduction of tariffs for agricultural and industrial products. That is one of the issues that we should thresh out in the next round of discussions," said an official of the Department of Agriculture (DA) who is one of the members of the Philippine panel.

The source said the talks bogged down last month because the Japanese government wanted to have separate talks for agricultural and non-agricultural or industrial commodities that will be included in the proposed tariff reduction program proposed under the Japan-Philippines Economic Partnership Agreement (JPEPA).

In the recent talks, Japan refused to budge from its hardline stance and insisted on maintaining its tariff shield on its sensitive farm products while demanding that the Philippines liberalize its industrial products.

"We have no problems with opening our agriculture sector because Japan has no agricultural products to export to us, but there are issues on how much could we accommodate their request to open up specific industrial products," said the DA official.

The official added that the Department of Finance (DOF) is also reluctant to reduce tariffs for industrial products because of the huge revenue that will be lost.

Previously, Assistant Agriculture Secretary Segfredo R. Serrano said that while the Philippines is embracing open trade in agriculture with Japan, the latter is still opposing tariff-free importation of rice, sugar, pineapple, poultry products and other agricultural commodities from the Philippines.

Currently, Japan charges a hefty 400 percent tariff on rice imports and a 200 percent tariff on sugar imports to protect its own farmers from the influx of imports.

Under the proposed JPEPA, duty-free trade between the two markets will be implemented for 10 years. The next round of discussions will resume next month.

Tariff Commissioner George Manzano said that currently, 72 percent of Philippine exports shipped to Japan are duty free, while 60 percent of Japanese products are brought to the Philippines at zero tariff.

He said the Philippines wants the remaining 28 percent of Philippine exports to enter Japan at zero tariff.

"Japan is a bigger market than the Philippines. If we could tap that market with our products, that will be our advantage," he added.

Tariff Commission chairman Edgardo B. Abon urged Filipino exporters to maximize their competitive edge and sensitivities with regards to the proposed bilateral free trade with Japan.

The Philippines wants Japan to scrap tariffs on agricultural products such as sugar, bananas, papaya, okra, eggplant, and tuna.

The JPEPA also includes services, investment rules, business environment and competition policy.

In 2003, top farm exports of the Philippines to Japan were fresh banana, which amounted to $170 million; frozen shrimp and prawn, $53 million; pineapple, $28 million; coconut oil, $22 million; and mango, $16 million.