Smuggling probe to resume amid debate on free trade

MANILA, Philippines—When the Senate resumes its investigation into reports of rice smuggling on Wednesday, the spotlight is expected to be on a businessman who has been tagged as the David Tan behind the smuggling of rice into the country.

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But an international trade expert said there should also be a discussion on how the country is heeding its international trade commitments, particularly on grains importation.

At the Senate, the chair of the committee on agriculture and food, Sen. Cynthia Villar, said David Bangayan, the businessman who had presented himself to the Department of Justice to deny that he was David Tan, has been summoned to shed light on reports that he is involved in smuggling.

Rosendo So, head of Samahang Industriya ng Agrikultura, was reported to have provided Villar’s committee with information on Tan and Bangayan.

As the Senate prepares to resume its investigation, international trade expert Anthony Abad, former administrator of the National Food Authority (NFA), said the country should take a closer look at its international commitment to free trade because the continued use of quantitative restrictions (QRs) in grains importation could be “considered a trade barrier.”

“Right now, the Philippines is in violation of its international commitments,” Abad, a lawyer and also the former head of the Philippine International Trading Corp., said in a statement.

QRs allow member-countries of the World Trade Organization (WTO) to restrict the importation of sensitive agricultural products, like rice.

From 1995 to 2005, the Philippines was allowed to impose QRs and was exempted from rice import liberalization. The country requested an extension of QRs and was granted one that expired in June 2012. Another request has been made to extend QRs but this has yet to be granted.

Abad said the continued enforcement of QRs was already in violation of the WTO because “technically, when you have an agreement that is time-bound, the special treatment clause expires upon the deadline.”

According to Villar, her committee will try to find answers as to why rice smuggling “continues to pervade.”

“Smuggling is one of the reasons why many of our farmers continue to live in poverty,” said the senator.

“The illegal entry of rice threatens their livelihood and the welfare of two thirds of our population who depend on agriculture,” Villar added.

The debate on the government’s interpretation of international trade pacts has been triggered by smuggling charges filed by the NFA and the Department of Agriculture against rice traders who in September last year brought rice into the country without NFA permits.

Rice traders had written the NFA in advance to inform the agency that they were importing rice without an NFA permit because QRs on rice imports had already lapsed.

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