By KARL G. OMBION
Bulatlat
Vol. VII, No. 25, July 29-Aug. 4, 2007
The Philippine sugar industry has shown itself time and again to be a moribund industry. It is dependent on colonial Philippine-U.S. trade relations. For a long time, the Philippine sugar industry has been tied to U.S. interests and demands, not to domestic needs and sustainable development. It is an industry molded and developed as export-oriented and import-dependent through unfair trade agreements with the U.S. and other advanced capitalist countries.
“Globalization” exacerbates this fundamental weakness of the sugar industry. With the worsening global crisis of overproduction, the industry is experiencing a massive decline comparable if not worse than the mid-1970s.
This crisis has been worsened by the following neo-liberal policies either imposed or adopted by the Philippine government:
1. Government avoidance of curbing protective measures and subsidies for sugar by major sugar exporting countries, especially the members of WTO-APEC-AFTA.
2. Government commitment to lowest bound rate and largest percentage reduction for tariffs on imported goods (from 80 percent in 1995, to 50 percent in 2004, to zero tariffs in 2010).
3. Executive Order No. 71 – modifying the rates of duty of certain imported articles as provided under the Tariff and Customs Code of 1978 as amended, and hastening its implementation under the New Time Frame of the Accelerated Common Effective Preferential Tariff Scheme for the ASEAN Free Trade Area (CEPT-AFTA), e.g. lowering it to five percent by 2007.
4. EO 334 – modifying the nomenclature and the rates of import duty on certain imported articles under Section 104 of the Tariff and Customs Code of 1978, as amended
5. Republic Act No. 6657 or the Comprehensive Agrarian Reform Law of 1988, as extended
6. U.S. Sugar Farm Bill No. 14, which practically turns the Philippine sugar quota in U.S. into a political tool to exert political and economic pressures on the Philippines.
7. Bio-Ethanol Act of 2007, providing more lands for sugar production for bio-ethanol.
But according to Bacolod-based independent social research outfit Center for Integrative Research, Advocacy and Multimedia Services (CIRMS), the worst effects of the “globalization” on the country’s sugar industry could better be assessed in the worsening conditions of the sugar workers and other farm workers in Negros.
According to CIRMS, Negros – once a resource-rich region – is now a ravaged land. Its once self-sufficient economy was transformed into a huge monocrop economy for the export market, with the local economy becoming a mere “dumpsite” for the surplus agricultural products of the U.S. and other monopoly-capitalist countries and its people – once self-sufficient productive forces – becoming “slave laborers.”
Among the other key findings in the recent CIRMS studies are the following:
1. Labor relations in sugar plantations have become more exploitative and oppressive as haciendero-compradors try to squeeze every opportunity and surplus to keep their farms profitable amidst the pressures of imperialist ‘globalization’. Records from Department of Labor and Employment –Region 6 and corroborated with available data from the Department of Agrarian Reform Region 6 and the Provincial governments of the region, revealed that more than 180,000 sugar and farm workers have lost their jobs.
2. Destruction of security of tenure, decreasing regular work force, and the surge in the number of contractuals, casuals, pakyao (piece-rate labor arrangement) workers, and an army of surplus labor. The “pakyao” system became more rampant in many haciendas. The use of the pakyao work system and other forms of contractualization has increased by 330 percent from 1995 to 2006, meaning that practically 3.5 of every five sugar plantation farms with sizes of 10 hectares and above use the pakyao and contractual work scheme. In sugar mills, there is rampant use of labor-only contracting, contractualization, indirect hiring or hiring through private agencies.
3. Shrinking of wages and cutting of benefits. More than half or 64.7 percent of 1,936 medium (25 – 49 hectares) and big (50 hectares and above) sugar farms in Negros are paying less than the minimum wage and engage in discriminatory wage arrangements for women. Surprisingly, minimum wage compliance is higher in small farms (24 hectares and below) than in big farms. Furthermore, close to half of 22,572 sugar farms in Negros are giving less cash payments and more are giving only food rations like rice, sardines, dried fish and others to workers. In sugar mills, there is a rampant practice of shorter work time and work rotation, resulting in the diminution of wages and removal of benefits.
4. Unpaid workers’ amelioration. Several labor groups in the sugar industry have recently demanded the release of their unclaimed and undistributed P240 million ($5.25 million based on a $1:P455.72 exchange rate as of July 27) annually since 2002 in social amelioration cash bonuses for the sugar workers, and at least P130 million annually from 1991 to crop year 2001-2002.
They said that the industry and the sugar planters associations owe them at least P240 million ($5.25 million) starting crop year 2002-2003 at P10.00 ($0.22) per picul, and hundreds of millions more from 1991 to 2001 at P5.00 ($10.94) per picul provided under RA 809.
John Milton Lozande of National Federation of Sugar Workers (NFSW) said that the sugar planters owe the sugar workers an estimated P150,913,299 ($3.3 million) in unclaimed and undistributed social amelioration cash bonuses. He also charged that the DOLE has been conniving with the sugar planters and “yellow unions and federations” in pocketing the workers’ money.
Under RA 6982 or the Social Amelioration Act of 1991 passed during the Aquino administration and at a time the sugar industry was facing a crisis, P10.00 per picul will go to sugar workers as amelioration share. Of the amount 80 percent will go to cash bonuses of sugar workers, and the 20 percent to various socio-economic projects.
The total number of sugar workers entitled to receive cash bonuses under the social amelioration program in the sugar industry is estimated at 500,000 – with approximately 30,000 in 27 operating sugar mills.
“The millions in sugar amelioration program are intended to uplift the working and living conditions of the workers; it should be given to them especially in the face of worsening poverty caused by the seasonal character of their job,” Lozande said.
He also said citing data from the Bureau of Rural Workers (BRW) that the average amount that each sugar worker received in a year is less than P300 ($6.56). “Surely this amount, even at P500 ($10.93) per year cannot in any measure ameliorate their working and living conditions,” he said.
He added that there are planters groups in BISCOM (Binalbagan-Isabela Sugar Company) and SONEDCO (Southern Negros Development Corp.) who really give the share to the sugar workers in compliance with the social amelioration fund (SAF) requirements of RA 6982, but pointed out that there are still numerous planters who are not only underpaying the workers but are even refusing to give their share.
He further disclosed that a number of planters do not remit the SAF to the workers because they use it as additional deposit to traders to assure that they can collect on their quedan or share after the sugar have been sold. “This is unlike in RA 6982 where there is a system in which they are obliged to pay their lien of P10 per picul upon withdrawal of their sugar,” he said.
He however put the bigger blame on the Department of Labor and Employment (DoLE) for what he described as its “internal incapacity” to assume effectively their enforcement functions, which he said are compounded by continuous leadership change in the department.
4. Destruction of right to organization. In the sugar industry in Negros, there are less unions or associations due primarily to elimination of regular work systems and employment of various labor flexibility schemes, and secondarily to the repressive rule of sugar farm owners. According to a report of Regional Tripartie Wages and Productivity Board in Region VI (RTWPB 6), less than 10 percent of total sugar farms in Western Visayas allow unions or other form of workers’ organizations.
5. Heightened attacks on and repression of workers and union activists. Data collated from various sources revealed that from 1996 to 2007 around 3,700 sugar workers’ and farm workers’ families were displaced from their lands, homes and jobs as a result of demolition, ejection, and land conversion campaigns by government and landlords; 930 were victims of various forms of harassments and threats from mills’ management, landlords and their armed goons; 32 were killed in the course of defending their farms and job and eight were forcibly disappeared.
6. Higher incidence of child labor in sugar and other farm plantations. CIRMS studies revealed that as of 2006, that there are 1.28 million children in Negros, of which 884,657 are in Negros Occidental, and 397,283 are in Negros Oriental.
Of this number, 334,900 are already working – 137,122 or 41 percent of whom are in Negros Occidental and 197,283 or 59 percent of whom are in Negros Oriental. Of the working children, 64 percent are rural-based and 36 percent are urban-based.
Child laborers are most numerous in sugarcane plantations and other agricultural farms. Others are found in commercial and marginal fishing trade, fish processing plants, dumpsites, commercial ports, warehouses, informal businesses, pyrotechnics, public transport utilities (trisikads, tricycles, public utility jeepneys or PUJs), eateries and carinderias, entertainment clubs and sex dens, and households.
Most of them suffer backbreaking work for hours especially those working in the sugar plantation farms, ports, warehouses, and households.
7. Permanent Tiempo Muerto. The start of “ember” season, which is marked by the opening of sugar milling and increased economic activities, is traditionally viewed as the beginning of good tidings for most Negrenses. It may have been true in the past, but not anymore.
The tiempo muerto or dead season in the Negros sugar industry, which runs from April to August, has become a year-round nightmare for an estimated 380,000 sugar workers.
Today, most Negrenses do not feel anymore the distinction between dead season and milling season, or boom and bust of the sugar industry; economic hardships and hunger have become daily problem for most people here especially the sugar workers. Most sugar workers are deeply indebted to their amo (bosses or masters) and often depend on them for daily survival on small cash advances and rice rationing. Their children also usually help in farm production and harvest without pay.
Even the middle class is feeling the pressures as their salaries remain low, and they suffer cuts in basic benefits and surging prices of basic commodities. A number of them face a lack of job security as a growing number of business establishments and private offices are employing labor-only contracting, casualization, and other “labor-flexibility” schemes resulting in loss of permanent jobs and diminution of salaries.
The tiempo muerto is very distinct in Negros which is a monocrop sugar-based economy. Unlike in other sugar provinces like Bukidnon, Iloilo, Cebu and Batangas where neighboring provinces have diverse economies, most people in Negros live and thrive only on the sugar economy.
Even the dominant service sector, wholesaling and retailing businesses in urban centers are very much dependent on the behavior of the sugar industry; thus if the sugar industry suffers crises, urban-based businesses also feel its ripple effects.
The only factor that keeps the Negros economy afloat and assures the continued circulation of the money supply is the remittances of Negrense overseas Filipino workers (OFWs) estimated by government at between 200,000 and 300,000.
8. Migration is another serious effect of the chronic crisis in the sugar industry and sugar-related industries. Official and unofficial sources place the rate of out-migration (migration to outside of Negros) at around 12,000 to 18,000 a year. Around 30 percent of those out-migrating apply for jobs abroad.
The most visible pattern of in- and out-migration occurs during tiempo muerto where thousands of sugar workers and hacienda-based households migrate to the city of Bacolod, provincial district urban centers, other provinces, and a few abroad, to look for jobs.
Most in-migrants take various odd-jobs such as transport conductors, drivers, construction workers, stevedores in the local ports and warehouses, errand workers in small eateries, while a substantial number – especially women and children – become commercial sex workers and house helpers.
9. Socio-cultural practices. Extreme poverty among the sugar workers and other farm workers have caused a rising trend of alcoholism, gambling, and other anti-social activities in 93 percent of areas where interviews were conducted. This trend appears to confirm the result of the cursory scans in 30 more plantation farms made by CIRMs in the last three years in the entire region.
In sum, the sugar industry has undergone two major stages of crisis.
The first stage was in the mid-1970s to mid-1980s, characterized by its collapse due to the worldwide glut in sugar.
The second stage began in the early 1990s and continues to the present, characterized by its struggle to survive the onslaughts of “neoliberal policies” of liberalization, deregulation, and privatization through technological innovations in milling, farming and sugar variety, and the use of more exploitative labor policies
But sugar millers employing “modern” milling technology for sugar and non-sugar based industries like bio-ethanol and bio-fuels, said that the upgrades are not signs of the modernization process in the sugar industry, but are attempts at coping with the pressures of and taking advantage of whatever they could get from the process of “globalization”.
“Globalization,” a neo-liberal economic policy of the U.S., has only made the nation’s sugar cartel (big planters, millers and traders) to implement measures to maximize the benefits from a neo-colonial economy that is export-oriented and import-dependent.
Philippine Sugar Millers Association (PSMA) executive director Jose Maria Zabaleta clearly articulated the position of sugar producers when he said, “Certain countries like Brazil have totally redesigned their mills to produce these three products on which it anchors its sugar sector’s competitiveness and vigor, making full use of installed facilities whole year round. For instance, Thailand, Australia, the United States, India, and Guatemala have also adopted or are adopting the same business strategy as they are now installing or have installed integrated co-generation and distillery plants in their cane milling facilities. Certain countries produce sugar at half the price of others, not because they have adopted new technologies but because they changed technology. New sugar/ethanol plants can produce sugar from primary juice at half the cost of a traditional mill while continuous production of molasses from the rest of the juice lowers cost of producing alcohol to half that of an old distillery; new boiler technology can now produce so much energy that large power plants generate a new revenue stream subsidizing sugar and ethanol.”
“If we add to these three products, produced at half the cost of the ‘old way,’ the advances in automation and electronics, the advances in cane supply logistics with IT (information technology) and GIS (geographic information systems) – hardware and software used for storage, retrieval, mapping, and analysis of geographic data, and a few etceteras, no wonder some people produce sugar at half the price of others. Where the economics justify, cogen plants are now being designed to run year round, allowing them to save on off-season energy costs, to refine sugar year round, and operate distilleries continuously, thus lowering capital costs in oversized refineries and distilleries. The traditional sugar mills will now have to play a catch-up game, but with assets in place and huge capital outlays required, they will not find it easy. Can sugar mills metamorphose to cane mills slowly or will they just have to shut down like the old ‘trapiches’ they replaced a century ago? I believe sugar mills as we know them have spread too far and too wide globally for them to just die by the way-side of the new technology.”
“Many lives are dependent on their continued existence. It behooves us as leaders and perhaps the most outspoken in the industry to see to it that a gradual transformation occurs and not a replacement of one industry for another,” he concluded. Bulatlat
