Senate pushes Sugar Cane Industry Development
bill in preparation for ASEAN integration

The Senate today passed on third and final reading a bill which seeks to help sugar industry players become more competitive when imported sugar starts flooding the local market with the integration of the Association of South East Asian Nations (ASEAN) Economic Community next year.

Senator Cynthia Villar, chair of the Committee on Agriculture and Food and sponsor of Senate Bill No. 2400, otherwise known as the Sugar Cane Industry Development Act of 2014, said the proposed legislation would put in place programs to promote and support the competitiveness of the Philippine sugar industry.

"The fear among sugar farmers is that they will not be able to compete with cheaper and government-subsidized sugar from abroad and this will directly impact their livelihood," Villar said.

"As it stands, we are self-sufficient in sugar but we are anticipating stiffer competition with cheaper sugar from abroad, particularly Thailand, which is the largest sugar producer among ASEAN countries with the Philippines coming in second," she added.

Senate President Franklin M. Drilon agreed, noting that the agricultural measure will greatly complement "the set of economic reform measures currently being pushed in the Senate to secure the country's macroeconomic fundamentals and fiscal sustainability, in preparation for the ASEAN Economic Community's (AEC) launch next year."

Once the bill is passed into law, Villar says the sugar workers will be granted more assistance to boost their competitiveness through the Block Farm Program, Farm Support Program and a scholarship program. The Block Farm Program is a consolidation of small farms, around five hectares or less, into a large farm.

"Admittedly, small players will have difficulties competing with bigger players. This practice will take advantage of the economies of scale in the production of sugar cane. This will result in operational advantages because activities in the small farms are aligned and the efficient use of farm machineries and equipment, deployment of workers, volume purchase of inputs, and financing, are ensured," Villar explained.

Meanwhile, owners of farms with around nine hectares or less can avail of the Farm Support Program wherein they will be granted access to socialized credit through the Land Bank of the Philippines for the acquisition of production inputs, farm machineries, and implements necessary for the continuous production of sugar cane.

Another provision of the bill is the availability of a Scholarship Program for the underprivileged college and post graduate students who are taking up courses in agriculture, agricultural engineering and mechanics, chemical engineering/sugar technology in state colleges and universities as well as vocational courses for farmers and farm technicians and skilled workers in sugar mills, sugar refineries, distilleries and biomass power plants.

Once the bill is passed into law, capability trainings will be conducted as well as attendance to local or international trainings including seminars by farmers and workers on the latest technologies related to sugar cane farming, manufacture or production and other products derived from sugar cane, according to Villar.

She said the program would be sourced from the Sugar Cane Industry Development Fund, which would receive 15 percent of the Value Added Tax on local and imported sugar and tariff collected from the importation of sugar.

"The bill aims to generate funds to strengthen the competitiveness and boost diversification efforts of the sugarcane industry, especially when tariff on imported sugar drops to a mere five percent by 2015 under the AEC," Villar said.

Currently, the Philippines sugarcane industry provides employment to at least 600,000 workers and contributes P76 billion annually to the country's economy. "The biggest opportunity is that it has turned our region and our market into a very promising and viable market. We need to equip Filipino businesses and industries, including the sugarcane industry, with adequate support to get a sizable chunk of that market or to seize those opportunities. The key is preparedness and enhanced competitiveness," Villar said. (Apple Buenaventura)