August 16, 1972

EXCHANGE OF NOTES BETWEEN THE REPUBLIC OF THE PHILIPPINES AND THE UNITED STATES OF AMERICA CONCERNING THE AGRICULTURAL COMMODITIES AGREEMENT

Note: The Agreement entered into force, August 16, 1972.

Reference: This Agreement is also published in XI DFA TS No. 1, p. 93,

Manila, 16 August 1972

19268

Excellency:

I have the honor to refer to your Excellency's Note No. 476 dated 16 August 1972 which reads as follows:

"Excellency:

I have the honour to refer to the Agricultural Commodities Agreement signed by representatives of our two Government on May 4, 1972 and to propose amendment to Part II as follows:

a. Item I, Commodity Table, is amended to add under the appropriate headings:

Rice, CY 1972, 100,000 Metric Tons, $14,775 thousand.  The Total

Maximum Export Market Value of the agreement increases from $27,848

thousand to $42,623 thousand.

b. Item II, Payment Terms, is amended in its entirety to read as follows:

Convertible Local Currency Credit

a. For tobacco, cotton, feedgrains and fallow:

1. Initial Payments — 5 percent

2. Currency Use Payment — 20 percent of the dollar amount of the financing by the Government of the exporting country under this agreement is payable to the Government of the exporting country in accordance with paragraph 6 of the Convertible Local Currency Credit Annex applicable to this agreement and on the following schedule: One-half the currency use payment applicable under this agreement will be due

May 1, 1973 and the balance of the currency use payment will be due on December 1, 1973.  No request for payment will be made by the Government of the exporting country prior to the first disbursement by the Commodity Credit Corporation under this agreement.

3. Number of Installment Payment — 15

4. Amount of Each Installment Payment - approximately equal annual amounts.

5. Due Date of First Installment Payment — 5 years from date of last delivery of commodities in each calendar year.

6. Initial Interest Rate — 2 percent

7. Continuing Interest Rate — 3 percent

b. For rice the payment terms are:

1. Initial Payment — None

2. Currency Use Payment — none

3. Number of Installment Payments — 21

4. Amount of Each Installment Payment —approximately equal annual amounts.

5. Due Date of First Installment Payment — 10 years after date of last delivery of commodities in each calendar year.

6. Initial Interest Rate — 2 percent

7. Continuing Interest Rate — 3 percent

c. Item III. Usual Marketing Table, is amended to add under appropriate headings:

Rice, CY 1972, none.

d. Item IV, Export Limitations, is amended by adding the following phrase at the end of paragraph B:

For rice, paddy brown rice and milled rice.

e. Item VI, Economic Development Purposes for Which Proceeds Accruing to Importing  Country are to be used, is amended in its entirety to read as follows:

Self-help measures specified in Item V and for economic development and flood relief and rehabilitation purposes as may be mutually agreed upon. The deposits referred to in Item VIII paragraph 4 below   shall be made to a separate account for relief and rehabilitation. The funds in this account will be used in accordance with apian of activity jointly developed by the Philippine Government and the United States Agency for International Development. These uses will be for mutually agreed upon  development projects with preference given to rehabilitation or improvement of feeder roads, irrigation systems, flood control  systems,  and school buildings in the disaster areas.

f. Item VII, Other Provisions, paragraph 4 is amended in its entirety to read as follows:

With reference to paragraph 4 of the Convertible Local Currency Credit Annex, the Government of the Importing country may make deposits of proceeds from the sale of commodities included in Item I above within one year from the sale of the commodities within the importing country. Except, however, the local currency accruing to the importing country from the sale of rice provided under this agreement will be deposited in a relief and rehabilitation account in accordance with the following schedule: 50 percent within 60 days of its  arrival in the importing country and the balance within the next 60 days.

All other terms and conditions of the May 4, 1972 Agreement remain the same.

If the foregoing is acceptable to your Government, I propose that      this note and your reply thereto constitute an agreement between our two Governments effective on the date of your note in reply.

Accept, Excellency, the renewed assurances of my highest consideration."

I have the honor to inform your Excellency that the proposal set forth in the above-quoted note is acceptable to my Government, and that your Excellency's note and this reply constitute an agreement between  our two Governments  which shall be  effective as of the date of this note.

Accept, Excellency, the renewed assurances of my highest consideration.

(Sgd.) CARLOS P. ROMULO

Secretary of Foreign Affairs

No.476

Manila, August 16, 1972

Excellency:

I have the honor to refer to the Agricultural Commodities Agreement signed by representatives of our two Governments on May  4, 1972 and to propose amendment to Part II as follows:

a. Item I, Commodity Table, is amended to add under the appropriate ings:

Rice, CY 1972, 100,000 Metric Tons, $14,775 thousand. The Total Maximum Export Market Value of the agreement increases from $27,848 to $42,623 thousand.

b. Item II, Payment Terms, is amended in its entirety to read as follows:

Convertible Local Currency Credit

a. For tobacco, cotton, feedgrains and fallow:

1. Initial Payment — 5 percent

2. Currency Use Payment — 20 percent of the dollar amount of the financing by the Government of the exporting country under this agreement is payable to the Government of the exporting country is accordance with paragraph 6 of the Convertible Local Currency Credit Annex applicable to this Agreement and on the following schedule: One-half of the currency use payment applicable  under this agreement will be due on May 1, 1973 and the balance of the currency use payment will be due December  1, 1973. No request for payment will be made by the Government of the exporting country prior to the first disbursement by the Commodity Credit Corporation under this agreement.

3. Number of Installment Payments — 15

4. Amount of Each Installment Payment — approximately equal amounts.

5. Due Date of First Installment Payment — 5 years from date of last delivery of commodities in each calendar year.

6. Initial Interest Rate — 2 percent

7. Continuing Interest Rate — 3 percent

b. For rice the payment terms are:

1. Initial Payment — none

2. Currency Use Payment — none

3. Number of Installment Payments — 21

4. Amount of Each Installment Payment — approximately equal annual amounts.

5. Due Date of First Installment Payment — 10 years after date of last delivery of commodities in each calendar year.

6. Initial Interest Rate —2 percent

7- Continuing Interest Rate — 3 percent

c. Item III, Usual Marketing Table, is amended to add under appropriate headings:

Rice, CY 1972, none

d. Item IV, Export Limitations, is amended by adding the following phrase at the end of the paragraph B: For rice, paddy brown rice and milled rice.

e. Item VI, Economic Development Purposes for Which Proceeds Accruing to Importing Country are to be Used, is amended in its entirety to read as follows:

Self-help measures specified in Item V and for economic development and flood relief and rehabilitation purposes as  may be mutually agreed upon. The deposits referred to in Item VII paragraph 5 below shall be made to a separate account for relief and rehabilitation. The funds in this account will be used in accordance with a plan of activity jointly developed by the Philippine Government and the United States Agency for International Development. These uses will be for mutually agreed upon development projects with preference given to rehabilitation or improvement of feeder roads, irrigation systems, flood control systems, and school buildings in the disaster areas.

f. Item VII, Other Provisions, paragraph 4 is amended in its entirety to read as follows:

With reference to paragraph 4 of the Convertible Local Currency Credit Annex, the Government of the importing country may make deposits of proceeds from the sale of commodities included in Item I above within one year from the sale of the commodities  within the importing country. Except, however, the local currency accruing to the importing country from the sale of rice provided under this  agreement will be deposited in  a relief and rehabilitation account in accordance with the following schedule: 50 percent within 60 days of its arrival in the importing country and the balance within the next 60 days.

All other terms and conditions of the May 4, 1972 agreement remain the same.

If the foregoing is acceptable to your Government, i propose that this note and your reply thereto constitute an agreement between our two Governments  effective on the date of your note in reply.

Accept, Excellency, the renewed assurances of my highest consideration.

(Sgd.)  HENRY BYROADE

Source: Supreme Court e-Library