IT looks like the

Senate blue ribbon committee will once again conduct an investigation about a matter that has something to do with sugar.

This is in reaction to the expose made by Sen. Ana Theresia Hontiveros about what she alleged as super-profiteering by three sugar importers whom she also implied were well-connected to Malacañang simply because they were seen having their picture taken with the President.

Fermin Adriano, a fellow columnist in this paper, has already recounted what is seen as a strange transaction where these importers were allowed by no less than the Department of Agriculture’s Senior Undersecretary Domingo Panganiban to import 440,000 metric tons of sugar even without a valid sugar importation order from the Sugar Regulatory Authority (SRA) board. Adriano revealed that Panganiban’s excuse was that said importation had already been green-lighted by Executive Secretary Lucas Bersamin. Before any importation can be allowed, an importation order should first be issued by the SRA board, and not the executive secretary.

We need to recall that former, and now reappointed, DA Undersecretary Leocadio Sebastian who was Panganiban’s predecessor, had to endure a blue ribbon investigation, for a sugar importation order that was validly approved by the SRA board. Sebastian and other members of the board all resigned under the pressure of being publicly shamed not only by the Senate, but by a public lusting for blood and for heads to roll, on imagined charges of corruption over a sugar importation that was not even consummated. As it turned out, while there were procedural lapses, many of which were not even the fault of Sebastian and the SRA board, the importation order was found to have been aboveboard. Sebastian and the SRA board were eventually cleared, but to this day the Senate blue ribbon committee has yet to issue an apology for casting aspersions on the name and honor of these public officials.

And now the committee is about to embark on yet another sugar-related investigation.

Certainly, there are problems in relation to this recent sugar importation which was the subject of Senator Hontiveros’ expose. It is indeed problematic that such importation was perfected without a valid importation permit from the SRA board. It even makes it more problematic that Executive Secretary Bersamin, who is a former associate justice of the Supreme Court, would issue an importation order knowing that this was not the proper procedure under the law. But what is even more odd is the fact that Panganiban would allow such importation, as if he has not learned any lessons from the brouhaha that his predecessor Sebastian had to endure.

The presumption in any investigation is always of regularity, and certainly it is the burden of Senator Hontiveros, and those who allege any wrongdoing, to prove their case against Panganiban and the three importers. However, the mere existence of an importation without a valid permit already raises a red flag. Nevertheless, alleging that the importers were favored by Malacañang just because they appeared with the President in a photograph is rather circumstantial.

This is actually my problem with the upcoming investigation of the blue ribbon committee. Its track record is not reassuring if we have to judge its performance based on the last sugar importation hearings. Senators would have to go beyond the convenient soundbites and the urge to grandstand, and focus more on actual evidence. They should be more preoccupied with establishing facts, instead of shaming the resource persons that they invite.

As it is, Senator Hontiveros’ charge of super-profiteering by the three importers cannot be made without hard evidence. Proving that procedures were violated when sugar importation was allowed on the mere go-signal of Malacañang, without a valid importation permit, is different from proving that there was super-profiteering and corruption, and that kickbacks and payoffs were made.

Hontiveros alleged the existence of corruption by simply comparing the price of sugar when directly procured from Thailand, to the price of sugar when procured from importers. Indeed, there is a big difference between P25 per kilogram of sugar which Thai exporters gave in their quotation to industrial users and the P85 per kg which local importers gave. To allege that there is collusion between Panganiban, who did not allow industrial users to directly purchase the cheaper sugar from Thailand, with the local importers to whom he directed the industrial users to negotiate with in terms of their sugar requirements, would require evidence.

The members of the blue ribbon committee should inquire into the logic of and the principle behind determining the price of sugar. It is misleading to compare the price of sugar when directly bought from Thailand by industrial users, and the price offered by local importers to local users, and to make conclusions of wrongdoing from the difference. The price of sugar directly imported as an ingredient to be used by industrial users is the price of a producer good, while that of imported sugar sold by importers is as a consumer good and reflects other costs, such as the tariffs paid, as well as the storage and transport costs which the importers would incur. Local industrial users would also impose their profit margin not on the sugar but on their finished consumer goods, whereas the imported sugar sold by local importers would now include a profit margin.

The senators will have to ascertain whether the P85 asking price of importers is fair, after taking into account the price of the imported sugar, plus the tariffs paid, the storage and transport costs incurred, and the profit margin applied. It is only then that we can conclude if indeed there is super-profiteering or not.

What is interesting is that lost in this entire noise is the fact that making imported sugar cheaper has always been considered as adverse to locally produced sugar, and thus would be harmful to the interest of local sugar farmers and millers. Hence, it is also useful to ask if the P85 per kg of imported sugar would be fair both to the consumers and the domestic sugar industry.