Impact of the Implementation of Commitments under the ASEAN Free Trade Area (AFTA), World Trade Organization (WTO) and Other Regional Trade Agreements to Domestic Trade Policies on the Swine, Poultry and Feed Grain Allied Industries
The Philippine livestock and poultry industries, particularly hog and chicken (broiler and layer), as well as upstream linkages, i.e., feed milling and feed grains have been protected from foreign competition with tariffs and other non-tariff barriers. Through the ASEAN Free Trade Agreement or AFTA and the international trade agreements of the World Trade Organization or WTO, tariffs have been reduced and eliminated of quantitative import restrictions on these selected agricultural products. As a result, imports of livestock and poultry have gradually increased. With the influx of imports, the long-protected local industries of hogs and chicken meat products, along with feed crops are faced with more competition from foreign players. As a member of the ASEAN, the Philippines is committed to bring down all tariff levels to 0% by 2010. All goods are subject to the removal of tariffs except for some products like rice which is still allowed up to 5% tariff rate. This paper looked into assessing the impact of further trade liberalization brought about by the implementation of AFTA in 2010, and the series of bilateral preferential trade agreements that ASEAN is a contracting party of, while also taking into consideration the possible absorption constraints in the related domestic industries. The analysis was based on an overview of the current production, consumption, trade and supply chain environments of local hog, chicken (broiler and layer) and corn industries. Also, AFTA was reviewed to gain an initial assessment of the possible impact of its implementation to selected industries. A list of indicators and parameters was drawn to serve as criteria in evaluating the impact of AFTA. With these methods, possible adjustment measures to minimize the effects of lowering the tariffs were recommended. Through increasing the productivity of hog and chicken industries and accessed to adequate infrastructure facilities, local industries may realize lesser impact from lowered tariffs.