RP, Thailand start formal talks on sugar tariff issue

Formal discussions have begun on a proposal to extend preferential tariff on sugar imports from Thailand as compensation for agreeing to a request by the Philippines to place sugar in the highly sensitive list under the Common Effective Preferential Tariff (CEPT) which takes effect next year.

The Philippines, along with Indonesia, had requested that sugar be placed in the highly sensitive list, effectively delaying the reduction of tariff on the commodity upon the affectivity of the CEPT next year.

Under the CEPT, member countries of the Association of South East Asian Nations (ASEAN) are to bring down their tariff levels to between zero and five percent.

However, some products may be placed in a highly sensitive list which will allow for a longer transition period.

Thailand has voiced its objection to the inclusion of sugar in this list since it will be the one that will be directly affected by such a move.

Sugar and rice are Thailand’s major exports to the ASEAN region.

To compensate Thailand, the Philippines and Indonesia are proposing to extend preferential tariffs for some other Thai products such as rice.

ASEAN members are already readying themselves for the effectivity of the CEPT under the ASEAN Free Trade Agreement by January next year.

An ASEAN Senior Economic Officials Meeting (SEOM) is scheduled for Sept. 13 to discuss the implementation of the CEPT-AFTA commitments.

Also scheduled for discussion in the same meeting are possible parallel free trade agreements with Japan, Australia and New Zealand.