RP, China early harvest program signed next month

The final agreement on the Philippines-China Early Harvest Program (EHP) is expected to be signed next month heightening fears by the local upland vegetable industry that the trade agreement will expose the fragile sector to the influx of cheap agricultural crops from China.

Industry sources said that Philippine trade representatives have already hammered out details of the EHP to be forged in December.

"It looks like the agreement will be signed in December, possibly before or during the WTO ministerial conference in Hong Kong takes place. The Philippine government is just looking at an opportune time or momentum to close the deal," said sources privy to the talks.

The signing of the EHP will hit the Benguet vegetable industry the most since it failed to lobby for the exclusion of its weak sector in the program. Earlier this year, the Department of Agriculture said the government could not accommodate the province’s request for exclusion from the agreement.

The EHP among others, calls for the elimination of tariff rates on all agricultural products by January next year.

Crops that would freely enter the country include carrots, potatoes, and cabbage which are commodities that are also produced by Benguet farmers. The Benguet Provincial Board asked for the exclusion of these produce in the EHP.

The government, however, could not grant the request because the EHP is part of the ASEAN-China Free Trade Agreement where the Philippines is a signatory.

The Philippines was able to insist on the exclusion of certain vegetables under EHP, but acceded to the request of China "to expeditiously complete the Pest Risk Analyses (PRA) for the importation of vegetables, in particular, carrots, cabbages, ginger and potatoes from China."

The PRA is a form of non-tariff barrier which, according to China, is an added impediment to the entry of Chinese vegetables into the Philippines.

The Philippines was also able to avoid the Chinese government’s insistence on a time-bound completion of the PRA. Implementation of the EHP would start by Jan. 1, 2006.

Among the items included in the EHP are pure-bred breeding animals such as live horses, bovine animals, swine, goats, chicks, turkeys, ducks and geese, and chickens.

Likewise, lives asses, mules and hinnies, sheep, primates, whales, dolphins and porpoises, manatees and dugongs, mammals, reptiles, birds of prey and other birds and other live animals are also included in the EHP.

Lamb carcasses, offals of bovine animals and swine would also be covered under the EHP.

Several variety of fish such as trout, salmon, herrings, haddock, mackerel, yellowfin tunas, skipjack or stripe-bellied bonito, cod, plaice, sole, eels, carp, halibut are also included in the EHP.

Other seafoods such as mussel, scallops, oyster, lobster, snails are covered as well.

Milk and certain dairy products such as cheeses are also included in the EHP.

Certain plants such as roses, trees, shrubs, rhodendrons and azaleas has been included as well.

A few vegetables not produced in the Philippines are included in the EHP such as brussels sprouts, globe artichokes, truffles, olives, capers, dried onions, dried mushrooms and truffles, dried peas, dried chickpeas, kidney beans and other beans and nuts such as almonds, brazil nuts and walnuts.

Certain fruits are also covered by the EHP including export winners such as bananas, pineapples, guavas and mangoes.

The DA said earlier it was also willing to open up high value fruits but the struggling livestock, rice and corn sectors still needs protection. There is concern that a lot of sensitive sectors could barely stand competition from the onslaught of cheap agricultural imports from China.

China for instance, wants mostly unprocessed raw agricultural products but the bulk of the Philippines’ sensitive products belong to that group.

On the upside, Agriculture Undersecretary Segfredo Serrano earlier explained that such a trade agreement should build up domestic farmers‚ confidence to undertake joint ventures, especially in processing more value-added products.

Under the current structure of Philippine agriculture, opening up its doors to China will primarily benefit bigger companies. On the other hand, small producers would be hit-hard.

Serrano said that while the Philippines opens up its doors to China, the local agriculture sector should be able to come up with structural adjustment mechanisms that would somehow cushion the impact on agricultural subsectors that will be hit-hard initially.