The bell tolls

The year 2014 has arrived and the bell tolls for the Philippine sugar industry as only a little over eleven months is left when the ASEAN tariff agreement takes effect and opens the floodgates for cheaper imported sugar.

Despite all the forebodings of ill-wind and near panic reaction, nothing is in place to this day to prevent what industry leaders and government officials and functionaries claim to be a catastrophic situation for the industry and the millions dependent on it.

Sure, there were a lot of movements, in fact truly a lot, but they all seem to be like a cat trying to catch its tail. It looks like everyone going through the motion but remains in place, a mime of sort.

These movements were like the clashing of cymbals and beating of drums, signifying nothing. They were like blowing of the balloon that seem so wonderful to see but bursts before it could even fly.

Publicity and plenty of money had been wasted for nothing to give us hope things will work out well for the industry.

Unless a miracle happens, we are seeing the sunset of the industry.

The effort to address the issue of the lifting of the tariff on imported sugar (as well as other agricultural products) has long been overdue. We have more than 25 years’ notice but everybody thinks the bells won’t toll.

Promises to protect the industry are dime a dozen since then Trade Secretary and later senatorial candidate Gloria Arroyo asked how prepared we are for free trade.

I remember her assuring the planters in Victorias that there are “safety nets in place” but until today there is no net, not even a sieve in place.

So everyone in government and industry dribbled and are still dribbling while the bells toll the hollow somber agonias.

There were serious movements after 2010 with the newly-elected Congressman Alfredo Benitez taking a purposeful step, but some sectors of the industry jettisoned his proposal before it could take off. The bill, which I also criticized, was worse than the cure.

He amended his bill and that seemed all right until leaders of the industry started shooting it down. There simply was too much sugar politics and the bill languished in Congress until it limped to its final phase, springing hopes that something afoot is well.

Then the RH bill debates stalled, subsequently scuttling it. Congress did not have time though all it needed was a little push. RH lobby money was sweeter than sugar.

While Benitez was doing his bit, leaders of the industry organized their own foundation under a promising Master Plan but from a structural point of view it was a formula for gridlock. While it declared it has prepared (or is preparing?) a master plan it just got stuck – analyses leading to paralysis.

The rivalry for who could save the industry stepped up but as in instances of this nature nobody gets saved.

Last year the Senate (finally) held a public consultation but the result was a mere reiteration of what had been said before, ad infinitum. The shadow replaced substance. 

The Sugar Regulatory Administration prepared its own master plan but it was more a list of intentions though finally the plan took form and focused on what is believed doable – block farming.

This is not new. The past attempts using this co-operative system failed because of cultural and political differences between the Philippines and Japan and China that have successful block farming systems.

Nevertheless this is better than talking and can succeed in the longer term if handled right. But what will happen once the initiators in the SRA leave office by 2016 and the promised support mechanism fails?

The Senate is set to file a bill based on its gathered data during the hearing, but if one looks closely, there are more ideas being said and proposed) outside of the hearing that if put together would surely make a poor broth from too many cooks.

The bells are tolling. Reports of international sugar glut are already hurting the sugar industry world-wide. Brazil is closing and selling some of its mills and India is also hurting from a global drop in prices.

Thailand is increasing the subsidy for their farmers (to the chagrin of millers) to keep them producing, part of its program to keep productions cost down.  

Excess sugar from other producers will find their way to the Philippines once the tariff is reduced to the minimum.

The Philippines that produces sugar at higher costs can’t compete.

This is the pessimistic side, tomorrow the optimism.*

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