Economist-congressman Joey Salceda of Albay's 2nd district has explained how his proposed importation of 400,000 metric tons (MT) of sugar would actually be beneficial to local farmers--something that seems counterintuitive on the surface.

"I already have a proposal to allow industrial users to import another 400,000 MT of refined sugar. If we auction those slots off, we could be earning as much as P12 billion, which we could provide to farmers and millers as direct subsidies," Salceda said in a statement Friday, Nov. 4.

He elaborated on this plan in a subsequent statement Saturday afternoon, Nov. 5.

"First, to clear up some points of fact, my proposal to allow the importation of some 400,000 MT should cover the end of SO2 (Sugar Order No.2) until the harvest season in 2023. Likewise, my proposal to raise revenues from imports is not out of tariffs, but out of auction fees," Salceda clarified. He said the auction fees cost as much as P30 per kilo.

According to the House Committee on Ways and Means chairman, this tactic would "result in prices that are lower by as much as 33 percent from domestic retail prices".

He earlier said as per the Intercontinental Exchange (ICE), the global price of sugar is now at just around P24 per kilo. Compare this to the retail prices in the domestic market, which reach as high as P120 per kilo.

Salceda further justified his proposal by highlighting that sugar is now the commodity with the highest inflation rate at 34 percent among all commodities in the consumer price index (CPI).

"Even if sugar in the Philippines were enough (and long-term figures indicate that we have a structural deficit of around 200,000 MT), our domestic industries are still constrained from growing due to high domestic sugar prices," he said.

He added that Hygh sugar prices "constrain us from having a big food export sector. Sugar is a major input in everything from dried mangoes to canned pineapples."

"Moving forward, the national conversation must go beyond whether there is enough sugar to meet our demands. Domestic availability is a limiting constraint, and unless we are able to lower sugar prices, our food manufacturing sector will stagnate if not decline.

"Food manufacturers will get the sugar they need, one way or another. If they can't get it here, they will either smuggle sugar or they will ship jobs abroad by setting up plants there. That is already the case with many of our homegrown brands," Salceda further said.