House to summon DTI, BOI officials on Thai poultry firm

MANILA, Philippines - Officials of Department of Trade and Industry and the Board of Investments (BOI) will be summoned to a House of Representatives hearing on Tuesday over their questionable move to grant a seven-year tax holiday and other perks to a Thai-owned hog and poultry firm.

In a privilege speech, Butil Rep. Agapito Guanlao  asked the committees on agriculture and food security to conduct an investigation on the approval of huge tax breaks and other perks to Thai-owned Charoen Pokphand (CP)’s  integrated hog and poultry production project.

Guanlao accused the BOI of “murdering” the local hog and poultry industries in granting pioneering status to CP to enjoy a whole range of tax exemptions, including a 30 percent incentive for the importation of corn and other raw feed materials.

“It is lamentable that the BOI appears to have put aside the interest of the local industry, which is just beginning to recover from losses amounting to P28.5 billion because of technical smuggling in the past three years,” he said.

“Now, the BOI is in a hurry to support a foreign competitor in various areas in Central Luzon. Amid strong opposition from our local industry, and most especially our backyard hog raisers that account for 80 percent of our hog production in the country, it is time for Congress to start a deep probe into this at the soonest possible time.”

Guanlao said the investigation should address four crucial issues: the preferential treatment extended by BOI to a foreign firm like CP is to the detriment of Filipino hog and poultry growers; the BOI appeared to disregard the statement of Agriculture Secretary Proceso Alcala that CP’s entry “will definitely have an adverse impact on the backyard industry;” that the Department of Agriculture (DA) appeared not to have been consulted in the approval of CP’s registration; and a 100 percent foreign owned firm will be allowed to acquire land in Pampanga and Tarlac.

“It makes my blood boil that while the DA has been trying to revive the barely recuperating local hog and poultry industries, the BOI leadership appears to be bent on pushing them down further,” he said.

“Did the acquisition of the hundreds of hectares of land by CP pass through the right processes? Perhaps we should also ask the Department of Agrarian Reform on this?”

The BOI should hold in abeyance the grant of registration and tax holidays to CP pending the outcome of the congressional inquiry, Guanlao said.

The BOI was accused of signing the “death sentence” of the hog and poultry industry in approving the registration of the P2.32-billion integrated production project of CP.

Industry leaders said allowing the entry of a multinational company is effectively a death sentence on local hog and poultry raisers.

The CP project will involve parent stock farms in Tarlac and Pangasinan, as well as six broiler forms in Bulacan and Nueva Ecija to begin operations in February 2013.

Rosendo So, Abono chairman and Swine Development Council director, said the move will surely kill the domestic swine and chicken industries which have yet to fully recover from a “storm” of rampant meat smuggling that resulted in losses of as much as P28.5 billion in the past three years.

“With the approval of the BOI of the project, which has an annual stock capacity of 25,453 heads for parent stock and 3,647 metric tons for slaughter hogs, and 21,847 metric tons of chicken, this will no doubt lead to the local industries’ eventual collapse,” he said.

So said Malacañang should order the BOI to re-evaluate its approval of CP’s registration.

“Are we going to let a foreigner control our local industry? Food security is a national concern,” he said.

“The BOI’s decision to grant perks to CP will kill not only the backyard industry but the entire domestic industry.

“Local producers are not enjoying the perks of tax holidays, but BOI easily granted such privileges to CP. Local growers cannot compete with a multi-national company like CP because the state is not all out in helping them.”

So said the “tsunami-like” proportion of meat products that the multi-national company will flood the local market with is expected to annihilate the backyard, small and medium growers.

So said some 7 million Filipinos working in the agri-business sector could displaced.

AGAP Rep. Nicanor Briones said the BOI might have violated Republic Act No. 8752, the Anti-Dumping Act of 1999.

“With BOI’s approval of CP investment in the area of agri-business, the anti-dumping law has effectively become useless,” he said.

The Anti-Dumping Act of 1999 provides protection to a domestic industry likely to be injured in the dumping of imported products, Briones said. – Paolo Romero, Jose Rodel Clapano