Duterte orders barter trade revival in Mindanao

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President Rodrigo Duterte delivers his speech during the inauguration of the Gaisano Grand Citygate Mall at the Buhangin District in Davao City on October 19.

Metro Manila (CNN Philippines, October 31) — President Rodrigo Duterte has ordered Monday, October 29, the revival of barter trade in Mindanao ahead of the plebiscite in the Bangsamoro region, which would be able to regulate barter trade if the Bangsamoro Organic Law is ratified.

"The revival of barter in Mindanao will not only create jobs and business opportunities, but also strengthen trade and commerce between and among member-states of the BIMP-EAGA," Duterte said in Executive Order No. 64, which was released to the media on Tuesday.

Encyclopedia Britannica defines barter trade as the direct exchange of goods or services without money or intervening medium or exchange.

Duterte created the Mindanao Barter Council (MBC) which would supervise, coordinate and harmonize policies, programs and activities on barter in southern Philippines until the Bangsamoro Government is organized and an office on barter becomes fully operational.

It would be headed by the Department of Trade and Industry (DTI) secretary and vice-chaired by the chairperson of the Mindanao Development Authority and the commissioner of the Bureau of Customs.

Representatives from the Department of Finance, Department of Foreign Affairs, Department of Agriculture, DTI - Autonomous Region in Muslim Mindanao, Maritime Industry Authority, Philippine Coast Guard and the Philippine Ports Authority would also serve as members of the MBC.

It may also call or invite representatives from the major Muslim ethno-linguistic groups, including the Tausug, Maguindanaoan, Maranaw, Yakan and Sama, to participate in proceedings.

The MBC is tasked to do the following:

Facilitate the establishment of an enabling environment conducive to the growth and development of barter in Mindanao

Formulate and issue rules and regulations on the registration or accreditation of traders engaging in barter within barter ports, including the imposition of registration fees and facilitation of all documentary requirements for zero-tariff benefits

Issue guidelines on barter, including a mechanism for the valuation of barter goods, a list of allowable barter goods and measures to prevent smuggling and circumvention of customs laws

Review existing policies, rules and regulations of government agencies that affect barter and submit recommendations to the President and Congress

Any other tasks assigned by the President

The MBC may also recommend to the President additional barter ports, wherein barter trading can only take place. The order initially established barter ports in Siasi, Jolo, Sulu, and Bongao, Tawi-Tawi.

Goods allowed for barter trade may only be traded in barter ports and only by qualified traders who have secured required documentation for the importation and exportation of goods.

Products with tariff protections or quantitative restrictions like rice, corn and sugar, and products which need special import permits or are subject to standard requirements are still regulated by applicable laws, rules and regulations.

All goods imported through barter trade which exceed a value of P10,000 would be subject to national and local taxes.

Article XIII, Section 26 of the Bangsamoro Organic Law or Republic Act No. 11054 provides that the Bangsamoro Government shall regulate traditional barter trade with the BIMP-EAGA member states and countertrade with the ASEAN.

The law would take effect once it is ratified by a majority of voters in the areas which would consist of the Bangsamoro region on January 21, 2019.

However, the provincial government of Sulu has asked the Supreme Court to nullify the Bangsamoro law, insisting that it is unconstitutional.