LOCAL sugar millers and glass manufacturers are urging the government to look into the sensitivity of sugar and glass products under the proposed Comprehensive Economic Partnership Agreement (CEPA) between the Philippines and the United Arab Emirates (UAE).
During the public consultation of the Philippines-UAE CEPA at the Tariff Commission on August 30, Department of Trade and Industry (DTI)-Export Marketing Bureau Director Bianca Sykimte said that part of the interest of UAE in the Philippines was the exports of sugar and glass products.
Sykimte said the Philippine negotiating team was eyeing to offer UAE zero tariffs for products that are “not locally produced or locally produced but not in sufficient quantity.”
She said part of the possible offer of the Philippines to the UAE to be given zero tariffs by 2025 were other sugar, including chemical pure lactose, maltose, glucose and fructose, in solid form; sugar syrups not containing added flavoring/coloring; and artificial honey and caramel.
DTI data showed that between 2019 and 2022, the country’s annual average import of these products amounted to $83.13 million.
Philippine Sugar Millers Association executive director Cocoy Barrera requested the Tariff Commission during the public consultation that sugar, raw and refined, be excluded from the PH-UAE CEPA.
“Although [the] UAE has no agricultural sector to speak of, it has some of the world’s largest sugar refineries. In fact, the two biggest, if I can recall, are Al Khaleej and Emirates. And their procedure is they import raw and export refined to the world markets. So, they can export sugar refined to the Philippines,” Barrera said.
“Although right now, we are not a part of their traditional export market, but we don’t know the dynamics in the future. They are looking for additional markets at the top considering that they have invested heavily, particularly the government of UAE, in their sugar refining sector,” he added.
Barrera said there should be an alignment of policies since the government is spending heavily through the Sugar Exchange Industry Development Act for the development of the local industry and it is also opening the market to potential importation.
Moreover, Glass Manufacturers Association of the Philippines Inc. (GMAPI) associate member Anthony Cabrera also voiced the concern of the local producers that UAE glass imports might flood the Philippine market.
Sykimte said the Philippine negotiating team might also open the local market to other glassware for kitchen, table, toilet, office, indoor decoration, or similar purposes from UAE for zero tariffs under CEPA.
The average Philippine import of these products amounted to $62.5 million between 2019 and 2022, with 7.19 percent or $4.5 million outsourced from the UAE.
Cabrera said the local industry had noticed a big surge of glass products being sent from the UAE to the Philippine market, “which is obviously impacting the dynamics of the local manufacturers and encroaching into our market.”
This was seconded by GMAPI member Rommel Dino, also the glass planning business manager at San Miguel Yamamura Packaging Corp.
“There’s [an] increasing level of importations coming into the Philippines, and we noted that the UAE is one of the countries that has the most importations,” Dino said.
“And this is very specific to the glass containers, which are being used by the beverage, liquor, and pharmaceutical industries in the Philippines. And as mentioned by my colleague, Mr. Cabrera, this has affected the local manufacturers, particularly the pharmaceutical industry.”
The parties are given until September 4 to submit their position papers to the DTI.
DTI Undersecretary Allan Gepty said the PH-UAE CEPA would hold the third negotiations from September 16 to 18.
Both countries target to conclude formal talks this year as part of the 50th-anniversary celebration of diplomatic ties between the Philippines and the UAE.
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