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Impact on Kingdom’s rice unclear as US mulls tariffs

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A man stacks sacks of rice at a warehouse in Phnom Penh last year. The US is deciding whether to remove rice from its Generalised System of Preferences (GSP) programme as growth in imports is affecting US farmers. Hong Menea

Impact on Kingdom’s rice unclear as US mulls tariffs

The US is deciding whether to remove rice from its Generalised System of Preferences (GSP) programme as growth in imports is affecting US farmers.

It is unclear at the moment how such a move would impact Cambodia. Although the Kingdom is technically not a GSP recipient, it receives duty-free access as a least-developed country (LDC).

USA Rice Federation (USA Rice), a global advocate for all segments of the US rice industry, testified at the US International Trade Commission (USITC) hearing late last month, supporting the removal of rice from a list of eligible commodities under GSP.

USA Rice said the US has long provided GSP benefits to developing countries, providing duty-free access, though it is only for parboiled rice.

For LDCs like Cambodia and Myanmar, all rice is eligible for duty-free access into the US.

USA Rice submitted a petition to the Office of the US Trade Representative (USTR) in March, which has since moved forward into the formal review process.

“US rice continues to face adversity in export markets where domestic industries claim import-sensitivity and use tariffs and non-tariff barriers to entry.

“It is time to acknowledge that US-grown rice is also import-sensitive and therefore we respectfully request the removal of GSP benefits for rice imports,” the petition said.

Information seen by The Post on Wednesday said as part of the 2020 Annual Review for modification of the GSP programme, the Trade Policy Staff Committee (TPSC) has decided to accept certain product petitions for review.

“USTR accepted the petition to remove rice products from GSP. It’s under consideration. USITC held a hearing on whether rice should be removed.

“USITC will submit a confidential report to USTR by August 31. USTR is expected to issue a ruling on or before October 31, and becomes effective on or before November 1,” the TPSC said.

It said the countries affected are Thailand, India, Pakistan, Brazil, Vietnam, Argentina and Cambodia.

Cambodia Rice Federation (CRF) president Song Saran said as an emerging market for rice exports, he will organise a meeting to deal with the issue.

“We will have a committee meeting on this. We have been supplying mostly organic jasmine rice and special aromatic rice to Asian communities in the US.

“It would surely have an impact on exports to the US considering that we are an LDC country and our competitiveness is still low. I ask the US to consider putting Cambodian rice in the GSP. It would be a boon for our small farmers,” Saran said.

He said Cambodia exported around 2,000 tonnes of jasmine rice to the US last year and 2,000 tonnes in the first six months of this year. “The volume may be small but it has an impact for small farmers growing jasmine rice,” he said.

Ministry of Commerce spokesman Seang Thay told The Post that Cambodia has never received GSP from the US for rice. “Presently, we only get GSP on travel goods which will expire by the end of this year,” he said.

Cambodia’s milled-rice exports gained 41 per cent to 397,660 tonnes in the first half of this year from the 281,538 tonnes shipped in the same period last year, data from the Ministry of Agriculture, Forestry and Fisheries said.

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