The red carpet that the Philippine government rolled out to Chinese investors at last January's ASEAN Summit has been soiled. Two weeks after we posted the first part of this blog entry, local reactions started brewing – from write-ups critical of the RP-China deals or the recently signed Biofuels Act to farmer protests in front of the Department of Agrarian Reform. People in the Philippines are increasingly questioning the government's seemingly misplaced enthusiasm towards these deals that seem to benefit only Chinese business and local elites. In a national forum on Philippines-China agreements held about two weeks ago, about 70 representatives from farmers, fisherfolk, women, and indigenous groups in the Philippines criticised the government for signing up more than a million hectares of agricultural land to Chinese corporations. Although the government representative from the Department of Agrarian Reform kept reminding the audience that the country will benefit from technology transfer which could increase farmers' income, leaders of different farmers' organisations debunked this by saying it is far from the real issue. The real issue being 'sovereignty' and how important this is to solving the problem of mounting poverty in the countrysides. One farmer leader, Ed Mora, spoke strongly saying “even if the agreements are legal, if they are detrimental to the farmers, they must be junked”. He was joined by others in condemning the government for 'giving priority to foreigners in using the country's agricultural lands while failing to accomplish its land redistribution programme'. It was an indignation seemingly shared by everyone including the former Vice President, Teofisto Guingona, a popular nationalist, who took time to participate in the forum and stressed that “any agreement the Philippines enters into must promote the national interest at all cost”. The fisherfolk groups share the same misgivings about the China deals, questioning the government's intention for “giving greater freedom to Chinese businesses at the expense of local poor fishers”. Part of the China agreements are investments in fisheries, including breeding and culture of grouper and other high-value species like abalone, sea cucumbers, sea urchins and scallops for export to the mainland. This, according to the fisherfolk leaders, is like having Filipino fishers merely grow seafoods for China. As if shifting in full gear to take advantage of China deals, the Department of Agriculture (DA) also lifted the ban on importation and culture of live shrimps and prawns, particularly Peneaus vannamei, a species of Pacific white shrimp that fisherfolk groups and fisheries NGOs claim to pose serious threat on the population of the local black tiger prawn. In 2001, the DA barred the entry of P. vannamei stocks into the country to protect the local black tiger prawn from the dreaded Taura virus that had nearly wiped out shrimp farms in Japan, Taiwan and Thailand. Yet despite the ban, this highly pathogenic shrimp has been reportedly cultured in at least 700 hectares in the provinces of Bulacan, Zambales and Pangasinan, according to one fisheries NGO. Agriculture Secretary, Arthur Yap, estimates that shrimp production in the country will increase three-folds with the production of P. vannamei and through the China deals. The secretary is looking at supplying the strong demand in Taiwan, Thailand and mainland China. Meanwhile, the recent passing into law of the Philippine's Biofuels Act – the law that prescribes the use of biofuels – not only came at a perfect time but further adds fuel to the craze. The critique by some that the law was drafted and passed by landed elites (including the clan of the president) who have self-interest in the biofuel industry, seems to have a strong basis. The law makes it mandatory to use bio-fuel. Within the next two years, bioethanol should comprise at least 5 percent of the total volume of gasoline fuel sold and distributed by every oil company in the country. It further doubles up (10 percent) in the succeeding two years, and so on. By passing the bill into law, the Congress has created a captive market for biofuels. And to set this into motion, the law gives incentives to biofuel producers, processors and importers by exempting them from all sorts of taxes. Both locally made and imported biofuels will be tax-free. Petrol companies are allowed to import biofuels for mixing if the local supply cannot meet the demand. All water effluents will not be classified as wastewater and will therefore not be subjected to wastewater taxation. The sale of raw materials, for conversion into biofuels will also not be subjected to VAT or value added tax (currently 10-12% of the gross price). These 'raw materials' as the law prescribes, are not limited to coconut, jatropha, sugarcane, cassava, maize and sweet sorghum. Rice as biofuel? Why not? Japan is already looking into rice-based biofuel. China is reportedly already working on it. It makes sense. Hybrid rice is one of China's biggest exports, the Philippines its biggest recipient. Although the media seemed to suggest that the focus of the Philippines-China agreements on biofuels would be on maize, the MOA with China's Fu Hua Co to invest US$ 3.83 billion in one million hectares actually include cultivation of hybrid rice. Must it be one of the reasons for the Department of Agriculture's ever-changing decision on its hybrid rice subsidy?