MANILA – Anti-smuggling coalition Fight Illicit Trade (Fight IT) bared on Monday the massive smuggling of partially de-husked coconuts from the Visayas to Hainan, China, which are used as seedlings to grow coconut trees in violation of the law and to the detriment of the coconut industry.
Executive Order No. 1016 issued in 1985 prohibits the export of matured coconuts and coconut seedlings. The Bureau of Customs (BOC) also issued Memorandum Order No. 116-92 which classifies coconut seedlings and mature coconuts as controlled products that require a certificate of exemption from the Philippine Coconut Authority (PCA) prior to exportation.
“We all know that the Philippines is one of the top producers of high quality coconuts and we are the second biggest exporter of coconut-based products in the world,” said Fight IT chairman Jesus Arranza in a press briefing.
Arranza, who also chairs the Federation of Philippine Industries (FPI), said smuggling of partially de-husked coconuts “is not only an act of economic sabotage, but it is akin to treason since these operators are giving away this products to Hainan, China, who will eventually become our competition.”
Based on the PCA report, the coconut industry is a dominant sector of Philippine agriculture, with 3.1 million hectares devoted to coconut out of the 12 million hectares of farmlands in the country.
The coconut industry is also among the top five net foreign exchange earners with an average of USD 760 million annually. It is estimated that between 25 percent and 33 percent of the population is at least partly dependent on coconuts for their livelihood.
Coconut is planted in 3.278 million hectares all over the country, dominating the landscape in 86 percent of all provinces, with 77 percent of all municipalities regarding it as a major crop.
More than 60 percent of Philippine copra and coconut oil exports also come from Mindanao and most of the country’s coconut oil mills are also based in Mindanao.
In 2012, Arranza said some 163,000 coconut seedlings were recorded smuggled out of the country. These seedlings originated from the provinces of Leyte and Samar and brought to Cebu port. From there, these will be shipped to Hainan, China.
This illegal trade was stopped but for the last three months of the year it started again and has been illegally exporting 20,000 coconut seedlings everyday at a price of PhP12-13 per seedling (farmer-trader), then these are being sold to China at PhP50 per seedling.
Arranza explained that unscrupulous traders buy partially de-husked coconuts from growers in Palo and Sogod in Leyte and consolidate them in 10 wheeler trucks that are shipped out from the ports of Ormoc, Baybay and Hilongos.
From there, the shipment goes to the international port in Cebu where it is shipped out to Haionan, China, one of the few provinces in the mainland with a tropical climate suited for growing coconuts.
“As you may know, only Indonesia and the Philippines have been gifted by nature with good quality coconut that is envied by other countries, hence exporting it in violation of existing regulation to China and other countries is obviously giving away our comparative advantage to our grave prejudice,” he noted.
Arranza said he already wrote to the Philippine Coconut Authority (PCA), Bureau of Customs, and the Senate Committee on Agriculture chaired by Senator Cynthia Villar asking for an investigation into the illicit activities of smugglers.
He said Fight IT is also working closely with the National Bureau of Investigation (NBI) on the growing illicit trade in sugar, tobacco, liquefied petroleum gas (LPG), and steel products.
Fight IT is a broad-based, multi-sectoral movement intended to protect consumers, safeguard government revenues, and shield legitimate industries from the ill-effects of smuggling. It was launched in 2015 and made up mostly of members of the anti-smuggling committee of FPI.