Coscolluela: Either ‘accept the reality
of competition’ or protectionism
Former Negros Occidental Governor Rafael Coscolluela said the local sugar industry is currently at a “crossroads” and it must decide to either “accept the reality of competition” or “continue to insist on protectionism.” In an exclusive interview with Watchmen Daily Journal, the former governor pointed out, if the local industry accepts the first option, stakeholders in the industry must immediately learn how to compete.
“Unfortunately, our current productivity levels in the country are not at par with our closest competitors,” Coscolluela pointed out.
He also pointed out other factors, such as government subsidies, and said Thailand, the Philippines’ closest competitor, benefits from such assistance, which has resulted in their country having “far bigger” sugar mills.
“We are different, because of agrarian reform, there are a lot of small farms so the average size is already very small and it’s not conducive for mechanization,” Coscolluela said. He went on to explain, farms that have remained relatively large need at least 30 hectares in order for mechanization to be efficient. However, the former governor said most farmers are operating on land 10 hectares and below, which forces them to continue using traditional farming methods.
The former governor noted, the average price for domestic sugar is P1,500 per bag, which local farmers can live on, but imported sugar ranges around P1,000 per bag. In addition, current conditions allow for the production of two million tons of domestic sugar per year, short of the 2.7 million necessary to meet demand.
“If we import, traders, or end users, will not buy expensive local sugar but rather world market sugar, which is much cheaper than domestic,” Coscolluela pointed out. “End users will say: Why will we buy expensive local sugar when imported is much cheaper?”
Last month, during a visit to La Carlota City, Senator Cynthia Villar called sugar liberalization an eventuality.
“We are now in a competitive age [and] we have to liberalize,” she affirmed. “It’s just a matter of time.”/DGB, WDJ