House committee seeks approval of bill on sugarcane dev't fund

MANILA, Philippines - The House committee on agriculture called for the swift enactment of a bill that would create a sugarcane industry development fund to help shield the industry from the fallout of the implementation of the ASEAN (Association of Southeast Asian Nations) Free Trade Agreement (AFTA).

Members of the panel, chaired by Batangas Rep. Mark Llandro Mendoza, unanimously approved House Bill 6113 or the Sugarcane Industry Development Act of 2012.

Negros Occidental Rep. Alfredo Benitez, principal author of the measure, said the speedy and unanimous approval of the bill showed the sense of urgency by lawmakers on the need to enact the measure.

He said the impending implementation of the AFTA is expected to trigger an unprecedented plunge in sugar prices.

Benitez and Mendoza said they are alarmed over the price destabilization effects on the sugar industry with implementation of AFTA calling for the lifting of tariffs on sugar in 2015.

“This uncertainty is further fanned by the impending lifting of the tariff on sugar by 2015. This scenario has spawned numerous reactions of uncertainty from the sugar planters, millers and consumers alike,” Benitez said.

“It is incumbent upon our policy-makers to institute measures, both by legislation and executive implementation of specific programs and projects, that will cushion if not counter the possible destabilization effects of the 2015 no-tariff provision on the sugarcane industry as a whole,” he said.

“These programs and projects that diversify sugarcane production involving not only raw and refined sugar but also its byproducts, namely bagasse, molasses and filter mud, should be identified, developed, promoted and implemented starting 2013,” he added.

He said the bill provides for a diversification, development and financial program to promote the interests of sugarcane farmers and planters, mill workers and consumers and contribute to the government’s food security efforts.

To be known as the Sugarcane Industry Development Act of 2012, HB 6113 mandates that the Sugar Fund be constituted and collected from the proceeds of value added tax on the sale and importation of refined sugar, and sugarcane byproducts; and the total tariff collected on the importation of raw sugar, refined sugar and premix sugar.

The amount collected will be remitted in full by the Department of Finance to a separate fund maintained by the Philippine Sugar Corp.

Benitez said the sugar fund would be utilized to finance the establishment of special economic zones, nuclear farms and agro-industrial districts; and provide financial assistance to sugarcane farmers, planters and mills for the purchase of seedlings, acquisition of machinery and construction of farm-to-market roads and irrigation.

The fund will also be used to conduct research and related feasibility studies; train mill personnel on current technologies; finance socio-economic programs for sugar farmers and mill workers; and provide scholarships for deserving university/college students taking up courses related to the sugarcane industry.

The lawmaker lamented that while the government has been supporting the sugar industry because of the contribution of the sugar export industry to economic development, there is an apparent neglect of the development of sugar byproducts, which aggravates uncertainty in the future of the sugarcane industry.