Rep. Alfredo “Albee” Benitez yesterday filed House Bill 6113 or the Sugarcane Industry Development Act of 2012 that he said is geared towards revitalizing and strengthening the industry through a diversification, development and financing program.

Benitez told the DAILY STAR it in incumbent upon policy-makers to institute measures, both by legislation and executive implementation, to cushion if not counter the possible destabilization effects of the tariff lifting on imported sugar entering the Philippines by 2015.

The neglect of the development of sugar by-products has further aggravated the uncertainty in the future of the sugarcane industry, he said.

Programs and projects to diversify sugarcane production should not only involve raw and refined sugar but also its by-products such as bagasse, molasses and filter mud that shall be identified, developed, promoted and implemented starting 2013, he said.

The act also aims to transform the sugarcane industry from merely producing sugar, to the production of power, fuel and other possible biochemical products, and as a means for waste disposal.

Under the ASEAN Free Trade Area agreement tariff on imported sugar entering the country dropped from 38 percent last year to 28 percent this year. It will further drop to 18 percent in 2013, 10 percent in 2014 and 5 percent in 2015.

Concern has been raised that the entry of cheaper highly-subsidized imported sugar into the country when tariffs drop will kill the domestic sugar industry, which produces sugar at higher costs.

DEVELOPMENT FUND

House Bill 6113 aims to establish a Sugarcane Industry Development Fund to be collected from the proceeds of 15 percent of the Value Added Tax on the sale and importation of refined sugar and sugarcane by-products and the total tariff collected on the importation of raw, refined and premix sugar.

All the proceeds collected will be remitted in full by the Department of Finance to a separate trust to be maintained by the Philippine Sugar Corp. to fund among others the establishment of Special Economic Zones for the sugar industry and agro industrial districts.

The fund is also geared toward providing assistance to sugar cane farmers, planters and mills to boost production, efficiency and diversification, for research and development, for socio economic programs, and scholarships for students taking degrees relevant to the sugarcane industry.

PSC ROLE

The chairman of the Philippine Sugar Corp. will be the administrator of the Sugar Regulatory Administration, the bill states.

All 11 members of the board shall be nominated by the SRA of which five shall come from the sugar farmers sector, five from the sugar millers sector and one from the international traders sector, the bill adds.

Upon the effectivity of the act, the positions in the board of directors of PHILSUCOR shall be deemed vacant and the president shall appoint new members based on the provision of the act, the bill states.

The SRA shall be the implementing agency of the act and together with the PHILSUCOR and representatives of the industry shall formulate its implementing ruled and regulations, HB 6113 adds.

The bill also states that to finance the sugarcane industry development initiatives of the act for fiscal year 2012, P50 million should be sourced from the unprogrammed appropriation of the Office of the President over and above the SRA allocation for the current year.

The required additional annual funding requirements should be incorporated in the subsequent annual budget of the SRA, it added.*CPG

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