18/02/2013 (Manila Standard Today) - A fund created to promote and protect the coconut industry has been importing palm cooking oil, which was being sold cheap in the local market and cause losses to coconut farmers, the minority bloc in the House of Representatives said on Sunday.

House Minority Leader Danilo Suarez said the Coconut Industry Investment Fund (CIIF), which was created from coconut levy to promote the industry, has imported palm oil worth P631 million in the past two years.

“We demand that the government explain why it allows the investment fund, which  was supposed to look after the interests of coconut farmers, was catering to farmers in other countries and promoting palm oil that is in direct competition with our coconut oil products,” Suarez said.

The government imposed a levy on sale of copra from 1973 to 1982 to create the United Coconut Planters Bank and the CIIF, which was tasked to manage the coconut levy fund. The farmers were assured of development of the coconut industry and a share of the investments.

The coco levy fund was estimated to have ballooned from the range of P100 billion to P150 billion in assets. A recent Supreme Court decision awarded P85 million to coconut farmers as the latest turn in the 40 year struggle to bring benefits to farmers.

Citing records of the Bureau of Customs, Suarez identified three oil firms owned by CIIF engaged in the importation of palm oil as Legazpi Oil Company, San Pablo Manufacturing Corporation, and Cagayan de Oro Oil Company.

He said the three companies imported a combined total of 11,721,069 kilograms of Mitra Cooking Oil from Indonesia valued at more than P631 million from 2011 to 2012.

“While businesses are free within the bounds of the law to engage in practices that will enhance profitability, there is an inherent conflict of interest when companies funded through the coconut levy fund engage in the importation of palm cooking oil,” Suarez said.

He called for congressional inquiry into the vested interests of the CIIF-owned oil mills because “there is a premise that the CIIF must be used to protect and improve the life of coconut farmers.

Suarez said he was appalled that the Aquino government patronizes another country’s products, which are sold at the local market at cheaper price, and it does not even grant subsidies to coconut farmers.

Because of the unfair practice of importation, coconut farmers were forced to bring down its farm gate prices and absorb losses, Suarez said.