VZCZCXYZ0000
OO RUEHWEB

DE RUEHML #0249/01 0370056
ZNR UUUUU ZZH
O 060056Z FEB 09
FM AMEMBASSY MANILA
TO RUEHC/SECSTATE WASHDC IMMEDIATE 3087
RUEHRC/USDA FAS WASHDC IMMEDIATE 1429

UNCLAS MANILA 000249 
 
SENSITIVE 
 
SIPDIS 
 
USDA FOR SECRETARY THOMAS JAMES VILSACK 
USDA/FAS/ONA/BERTSCH 
STATE PASS USTR FOR WEISEL 
 
E.O. 12958: N/A 
TAGS: EAGR ECON ETRD EAID RP
SUBJECT:  Proposed U.S. Agribusiness Trade and Investment Mission to 
the Philippines 
 
Ref: 08 Manila 820 
 
¶1.  Summary: Post has received a copy of a letter from Philippine 
Secretary of Agriculture Arthur Yap congratulating U.S. Secretary of 
Agriculture Thomas Vilsack on his confirmation (full text of letter 
in para 7).  The letter encourages a U.S. agribusiness trade and 
investment mission to the Philippines in the first half of 2009. 
Post recommends that, if his schedule allows, Secretary Vilsack 
accept Secretary Yap's invitation and lead such a mission to the 
Philippines.  End summary. 
 
¶2.  The Philippines is a key market in Southeast Asia for U.S. 
agricultural exports, with record sales of over $1.7 billion in FY 
¶2008.  The top U.S. exports last year were wheat ($639 million); 
soybean and soybean meal ($335 million) and dairy ($223 million).  A 
net food importer, the Philippines is the second largest market in 
Southeast Asia and the 17th largest global market for U.S. 
agricultural products.  The United States is the top food and 
beverage supplier to the Philippines.  Agriculture is also important 
to the Philippine economy, accounting for approximately 18.3 percent 
of Philippine GDP and employing over 11.5 million workers (one-third 
of the workforce). 
 
¶3.  The Philippines has demonstrated support for U.S. agricultural 
interests, including statements on food aid and monetization in the 
WTO.  In 2007 it became the first market in Asia to permit market 
access for U.S. beef and beef products of all cuts and ages 
following the 2003 detection of BSE in the United States.  The 
Philippines is the first and only Asian country to approve the 
planting of a biotechnology food crop (corn) and remains a 
consistent supporter of rational, science-based regulations in many 
international agencies dealing with biotechnology. 
 
¶4.  USDA has a long history of providing technical assistance to the 
Philippines.  In 2008, the Philippines was the largest recipient of 
Food for Progress grants, which totaled over $24 million to help 
develop the local dairy, rice, coconut, coffee and cocoa sectors. 
The Philippines will again be a priority food aid country for FY 
¶2009.  The Philippines is the largest recipient of USDA food aid 
programs in Asia, with PL 480 Title I allocations reaching $200 
million (cumulative) since FY 2000.  USDA has also provided 
assistance to the Philippines via the Cochran Fellowship Program and 
the Norman E. Borlaug International Agricultural Science and 
Technology Fellows Program, and through regional workshops and 
training offered through international organizations.  In 2008, the 
Philippines obtained a $75 million export credit guarantee, under 
GSM 102, which it used to buy some 72,000 metric tons of rice from 
the United States. 
 
¶5.  In 2008, USDA Secretary Edward Schafer and the Philippine 
Department of Agriculture Secretary Arthur Yap signed a Memorandum 
of Agreement on Cooperation in Agriculture and Related Fields.  The 
new Agreement established an enhanced cooperative relationship in 
agricultural technical assistance and trade capacity building with a 
focus on assisting the Philippines to revitalize its agricultural 
sector, particularly in Mindanao. 
 
¶6.  There are also difficult market access issues with the 
Philippines.  At present, the Philippines is proposing changes to 
its tariff rate quota system (affecting especially U.S. exports of 
pork and poultry) which could be very problematic for U.S. 
suppliers.  We believe a visit by Secretary Vilsack to the 
Philippines in the first half of 2009 would provide valuable 
leverage on this issue, as well as enhancing U.S.-Philippines 
Agricultural ties.  There has not been a visit of a U.S. Secretary 
of Agriculture to the Philippines in recent years. 
 
¶7.  Begin text of Yap's letter: 
 
January 20, 2009 
 
Honorable Secretary Thomas James Vilsack 
United States Trade Department of Agriculture 
Washington, D.C. 
United States of America 
 
Dear Secretary Vilsack: 
 
It is with great pleasure that I congratulate you on your 
confirmation as Agriculture Secretary.  I wish you the best and look 
forward to working with you in making agriculture a pillar of the 
strong relationship between our countries. 
 
Prior to your appointment, a U.S. agribusiness trade and investment 
mission to the Philippines was scheduled in the latter part of 2008 
but was postponed for the first semester of 2009.  It would be 
 
fitting for you to lead this mission which can give both our 
agribusiness sectors a boost while exploring further areas of 
collaboration. 
 
On this occasion, we would be pleased to show you the country's 
gains in food security through gains in rice, fisheries and 
biofuels. 
 
The month of March is an opportune time for you and your delegation 
to visit the Philippines.  Please let us know if this proposal will 
work for you. 
 
Finally, we hope for the best as we work towards revitalizing our 
countries' strong strategic partnership in agricultural cooperation. 
 One mechanism is through joint implementation of the Memorandum of 
Agreement (MOA) on Agriculture and Related Fields which our agencies 
have entered onto on June 24, 2008 and whose signing was witnessed 
by President Gloria Macapagal Arroyo during her working visit to the 
United States.  Collaboration particularly in science and technology 
to advance agricultural productivity and trade is one common 
interest we can enhance further. 
 
Thank you and best wishes. 
 
Very truly yours, 
 
Arthur C. Yap 
Secretary 
 
End text.  (We understand that the original letter was delivered 
directly from the Philippine Embassy Washington DC to the U.S. 
Agriculture Secretary's Office.) 
 
KENNEY