Filipino banana growers and exporters renewed their call for the government to prioritize the forging of a free-trade agreement (FTA) with South Korea to remove the tariffs slapped on Philippine Cavendish.
The Pilipino Banana Growers and Exporters Association (PBGEA) said there should be no let-up in government efforts to pursue an FTA with South Korea, as Philippine Cavendish could lose market share to bananas from Central American nations due to Seoul’s high tariffs.
“We [urge] Malacañang to immediately and seriously look at the plight of the country’s second-largest agricultural export being charged with atrociously high import tariffs in South Korea,” PBGEA Executive Director Stephen A. Antig said in a statement on Thursday.
Trade Secretary Ramon M. Lopez met earlier this month with South Korean Trade Minister Kim Hyun-chong to appeal anew for the reduction of tariffs on Philippine banana.
“[We] renewed the request to lower tariff on our banana exports for greater market access in South Korea. [We had an] open discussion, and we are considering options on a better process moving forward, either bilateral trade through a preferential trading arrangement or under Asean-Korea,” Lopez said in a text message to reporters.
South Korean Ambassador to the Philippines Han Dong-man said the only way Seoul can reduce the tariffs slapped on Philippine banana exports is through the Regional Comprehensive Economic Partnership (RCEP).
Han said the conclusion of the RCEP remains as the “priority avenue” for Seoul to cut the 30-percent tariff on Philippine banana exports. The RCEP is a regional trade agreement involving 16 countries, including South Korea.
“We will try to reduce the tariff with the accomplishment of the RCEP. If they conclude the RCEP, then we can have whatever free-trade agreement [FTA] where we can reduce such tariff,” Han said during the BusinessMirror Coffee Club forum in Makati City last month.
“This is a very important issue for me because Davao and Mindanao, where the bananas are coming from, is the hometown of President Duterte,” Han added. He also said that the share of Philippine bananas in the South Korean market has declined to 80 percent from 90 percent due to the influx of cheaper bananas from Central American countries, which enjoy lower tariffs.
However, the PBGEA said awaiting the conclusion of the ambitious RCEP to settle the tariff issue with South Korea would be “very tedious” for the local industry.
“The route of RCEP will be far too long and circuitous. Multilateral discussions on this trade pact started in 2012 and are still going on. Who knows when it will be done?” Antig said.
“Philippine banana exporters are already battling it out in South Korea with competitors granted concessionary import tariff rates. We cannot afford to wait while this happens. This issue must be immediately taken up on a bilateral basis and specific to bananas,” he added.
Antig said “time is of the essence for the Philippine banana exporters and the government in this campaign to eliminate the high tariff in South Korea.”
“Peru banana exporters have been enjoying zero tariffs as early as 2015. By 2020, barely 15 months from now, other suppliers like Colombia will enjoy zero tariffs, while Philippine bananas are still imposed a 30-percent tariff,” Antig said.
“A bilateral agreement between Manila and Seoul is the only way for the country’s banana exports to have a fighting chance against competition in South Korea,” he added.