Jan 27, 2012

Philippines - PHL, Italy negotiate debt swap to fund safety, traceability of food exports



DAVAO CITY—The Philippines is currently negotiating with Italy to finance its product traceability project, a strategic food safety and marketing effort to assure prime markets like Europe and the US of the bio-safety origins of their food exports.

As of Wednesday, Italy was willing to take as much as €2.9 million in a debt-swap scheme with the Philippines, said Renea Cruz, the Filipino consultant of the United Nations Industrial Development Organization (Unido).

The amount will be used to acquire software to record and report all activities in the food chain, from the farm up to the loading of the products for export, Cruz said. Part of the amount would also go to training the needed human resources among companies and industries, as well as to help defray any financial requirement to install the traceability mechanism.

She said that the Philippines was testing the traceability design on five food export products—banana, pineapple, coconut, mango and tuna—where the monitoring and reporting concept would be less of a problem with big industries, she said.

“We would be training and persuading the small farmers and growers in these industries to adapt to this new system of reporting because ultimately, this would redound to their benefit anyway. Besides, we will tell them that this is the current real market requirements and we would like to be ahead in the market,” she added.

With the Philippines refining the design under the program called Philippine Traceability for Revitalized Agricultural Competitiveness Enhancemenor P-Trace, “it is now ahead in Asia,” she said.

Egypt was the first country to install its own program called Traceability Center for Agro-Industrial Exports or E-Trace in 2004, and its central monitoring and tracing center was embedded in its Ministry of Trade and Industry, Cruz said.

In the Philippines, the implementing agency would be the Department of Trade and Industry, supported by the Department of Finance and the National Economic and Development Agency.

The Unido has taken up with exporting countries to install a clear traceability system of its agricultural and industrial food exports after Europe and the US enacted the traceability of all food items from their traders and business owners, including their export partners.

The requirement by these countries emanated from their bioterrorism concern. Their anxiety prompted their governments to put more sophisticated requirements for market access, according to a program information released by the DTI during the meeting of the five identified industry clusters with representatives of the Unido at the Marco Polo Hotel here on Wednesday.

The two major importing markets “need to be assured that the products they will export are safe for consumption,” the program information said, adding that the traceability system would need all the information in the entire food chain, from the origin of the products to the middle traders, to handling and processing, and up to shipping for export.

Alaa Fahmy, director of the E-Trace Center in Cairo, Egypt, said he would take up with the five industry representatives “on the experience of Egypt, at how it has increased its export immediately after we installed the traceability mechanism.”

“Our businesses and industries and our government expressed the same concerns that your businesses here have expressed when we started the program there,” he said, citing the apprehension that local businesses may not be able to afford the competition posed by the more well-off and well-positioned businesses in the more developed economies.

He said Egyptian farmers and industry leaders were also concerned that the bioterrorism origin of the market requirement put up by Europe and the US may unduly expose the country’s production weakness and capacities among local farmers.

“These are the same concerns that your Filipino industries have also expressed when Unido began to talk with your officials and industry leaders,” he added.

“But we are also here to help your industries finally refine the design and begin your own implementation so that you can also enjoy the benefits of the program in terms of easier access to the markets and preferential treatment of your products,” he said.

MANUEL T. CAYON
Business Mirror



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