Agriculture Government News

Duterte’s bridge to the Gulf

Another week another country – and next week Philippine President Rodrigo Duterte will be in the United Arab Emirates (UAE), arriving in the capital, Abu Dhabi, on Wednesday. This is his first trip to the Middle East since assuming office in July last year, but it’s one he’s wanted to make for some time – not just to meet the Emir, Sheikh Khalifa, and discuss ways of strengthening their countries’ bilateral relations; Duterte has a very personal reason for wanting to be there.

This is his chance to thank the world’s second largest group of Filipino overseas workers – Saudi Arabia, next door, has the largest – for their massive support in delivering him the presidency. And, likewise, they will want to see him. And they will; a large-scale reception at which he can get together with his compatriots has been planned.

In last year’s May elections, of the UAE’s 61,103 registered Filipino Overseas Absentee Voters, 83.5% of them – 51,879 – voted for Duterte. His nearest rival, Mar Roxas, managed to garner just 3,985 votes.

He has other reasons to thank them though. In 2016, remittances to the Philippines from the UAE were around US$3.5 billion. This accounted for 12% of the year’s global total in money transfers to the Philippines which reached US$29.7 billion. Remittances by UAE-based Filipinos – an official population of 575,000 – are consistently one of the most prodigious of any expat group, anywhere.

But, impressive though those figures are, there are a number of concerns. The 575,000 number is the record of the UAE’s Ministry of Foreign Affairs, while the Commission of Filipinos Overseas puts it higher – in 2012 it claimed 900,000 Filipinos were in the country. “We really don’t know the real number,” Constancio Vingno Jr, the Philippines ambassador to the UAE, said in an interview in January.

The history of diplomatic relations between these two countries is relatively short – starting 17 June 1980 when Manila opened a diplomatic mission in Abu Dhabi. In that time, they’ve made headway in a number of areas including reaching consensus on an air-services, tax, labour, and agreements between their respective chambers of commerce.

There are also strong people-to-people relations between the two countries; in the Philippines the Emirates Red Crescent teams up with the Philippine Red cross to carry our disaster-relief operations. In 2013, it raised money to rebuild a number of schools destroyed by the devastating super typhoon, Haiyan.

That said though, little has been done in terms of a comprehensive cooperation agreement that would allow both sides to boost trade, investment and tourism, as well as refine those tricky labour arrangements.

Making progress in these areas is likely to be on the agenda during Duterte’s visit. To this end, also, we may see plans to establish a joint forum or committee that would meet in the Philippines and the UAE on a rotational basis. Certainly, closer contact in the area of economic development will be sought.

But two other items up for discussion are likely to be: one, UAE support for peace efforts in Muslim Mindanao; and two, agriculture.

Duterte knows he needs all the help he can get in resolving the 17-year-old stop-start effort to establish the Bangsamoro Autonomous Region – a proposed political region that will be the homeland of the Moro (Muslim) people of Mindanao where armed conflict between Moro rebel-paramilitaries and government forces has been ongoing since the late 1960s.

The UAE, 76% Muslim, supported the talks that resulted in the 2 September 1996 peace agreement between the government of Fidel V. Ramos and the Moro National Liberation Force (or, MNLF). It’s also backed the Philippines’ bid for observer status at the Organisation of Islamic Cooperation – a bid that’s been under review since 2003.

Now, its support would be welcome in making Bangsamoro a reality for the other large Muslim faction, the Moro Islamic Liberation Front (or, MILF). Duterte knows that if he can put this to bed, dealing with smaller Islamist terror groups in Mindanao – such as the Abu Sayyaf – will be much easier.

That’s a big issue, but commerce is perhaps the main area that could benefit quickly from closer ties. Last year, two-way trade was worth just US$616 million putting these countries way down each other’s trading-partners lists. Philippine exports to the UAE cashed in at US$301.27 million; while its imports from the UAE totalled US$474.65 millon.

And whatever the figures were for shipments of Philippine agricultural products to this Gulf region were, they couldn’t have been very impressive. And this is surprising, given the food-security needs of the UAE: an arid region, it has insufficient land resources for growing crops and is heavily dependent on imports of fresh fruit and vegetables – products which the Philippines has in abundance.

The UAE is a sizeable market – it may only have a resident population of 9.4 million, or around 9% of the Philippines’ 103 million, but if you add in the annual influx of tourists (largely destined for Dubai) that number virtually trebles. After all, they also need feeding.

In 2015, US$19.2 million worth of Philippine bananas were eaten in the UAE which made it the fifth biggest consumer of the Philippine-sourced fruit. But what of other products – abaca, cassava, coconut, corn, mangos, pineapples, sugarcane?  And what about meat?

Mindanao, home to the country’s largest Muslim population, is the centre of halal meat preparation in the Philippines – a resource which the Department of Agriculture would dearly love to capitalise on. Worldwide, this is a US$1 trillion business.

To date, however, the Philippines has barely been able to penetrate it. And here’s the reason. Muslim countries demand halal certification for high-quality processing of meat products. The Philippines has made some strides in this area – the sector supports around 500 halal-accredited companies, and in May last year it passed the Philippines Halal Export Development and Promotion Act. But Muslim nations are wary of all product certification from overseas suppliers – particularly a new and untested one.

And the UAE is certainly no exception to that. In fact, overseas-sourced halal products entering the country must first undergo testing by the Emirates Standards and Metrology Authority (ESMA). They then have to be accredited by the ESMA and re-certified before they can be sold in the UAE. Given the Philippine Department of Agriculture’s plans for halal exports, it’s possible it will seek help from the Emirates’ authorities to get the Philippines certification processes up to speed.

Tourism is another area that may well be explored during Duterte’s trip. In 2015, Philippine resorts and hotels received 16,881 UAE nationals while flight frequencies between Manila and the UAE cities of Abu Dhabi and Dubai were also increased.

There’s a lot to chew over here, but there are strong indications that the two leaders will hit it off, and we expect President Duterte to bring back some good deals from the Gulf.

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