Manila set to raise Thai rice import quota
Thailand expects to negotiate an increase in its rice-import quota to the Philippines to more than 100,000 tonnes to compensate for Manila's decision to maintain its high import tariff for another five years.
Under its World Trade Organisation (WTO) and Asean Free Trade Agreement (Afta) obligations, the Philippines is required to provide such compensation for maintaining the high tariff.
Srirat Rastapana, director-general of the Thai Trade Negotiations Department, said yesterday that Thai rice exports should have a brighter future in the Philippines thanks to growing demand for the grain there. As a result, Thailand must negotiate to ensure the import quota is increased, or the high tariff could see Thai rice lose market share.
Manila recently asked the WTO for permission to keep its import tariff on rice at a high 40 per cent for another five years through 2017. In return, it must increase the Country Specific Quotas for Thailand and other rice-exporting countries.
Currently, Thailand is allocated a quota of 98,000 tonnes under WTO rules.
In Bangkok yesterday, Thai and Philippine officials negotiated the minimum market access for rice imports. Manila is also negotiating rice quotas with Vietnam, Pakistan, India, China, the US, Australia, Canada and El Salvador.
Srirat said that Thailand and the Philippines had yet to reach a final agreement on the size of Thailand’s rice quota because the Kingdom was pressing Manila to accept a quota of several hundred thousand tonnes.
The Philippines must increase its quota for Thailand under its Afta and WTO commitments. Manila does not have to abolish import tariffs on rice, because it classifies the commodity as a “highly sensitive good”. However, it has offered Thailand an annual rice-import quota, on which no tariff is imposed.
Under the WTO and Afta, the Philippine import tariff on Thai rice shipments beyond the import quota is 40 per cent for 2010-2012, and will be reduced to 35 per cent in 2015.
The Philippines has also promised to import at last 367,000 tonnes of rice from Thailand. The country is also expected to import 50,000 tonnes of premium-grade Thai rice.
Thailand also wants to participate in drafting the bidding conditions for rice imports into the Philippines to ensure transparency.
Srirat said that although Thailand has received an import quota, Thailand can export only 18,000 tonnes a year to Manila because of the Philippines’ complicated bidding method.
Thailand has also asked the Philippines to allow imports of fresh chicken, as the Kingdom has been free of bird flu for many years.
The Philippines is the world’s largest rice importer, absorbing about 1.8-2 million tonnes of the stuff each year. It is expected to produce 10.54 million tonnes of rice this year, but demand for consumption has reached 13.35 million tonnes.
Vietnam is the biggest rice supplier to the Philippines, with an 82-per-cent share, followed by Thailand with 16.2 per cent.
