ECONOMIST-lawmaker Jose Maria Clemente “Joey” S. Salceda cited the best play in pushing down the prices of rice per kilo is combining tariff cuts with aggressive buying by the National Food Authority (NFA). Doing so could see the price of imported rice to go down by as much as P6 per kilo.
Salceda issued his proposal after the Department of Finance (DOF) signaled its push for the reduction of rice tariffs to as low as zero percent to cushion the impact of rising world market rice prices and temper the increase in the price of the staple locally.
“With three weeks left before Congress adjourns, this decision is best left to the President and his power to adjust tariff rates when Congress is not in session,” Salceda said. “Obviously, it will be a temporary modification. But it is a viable solution for present rice price issues.”
The lawmaker expressed support to the state’s stance “to ensure that we have all the options necessary to meet our local demand and reduce the consumer price of rice.”
Earlier, President Ferdinand R. Marcos Jr. urged Filipinos to report violators of Executive Order 39. The order has set the mandated price ceiling of regular milled rice at P41 per kilogram and of well-milled rice at P45 per kilogram.
According to Salceda, the DOF proposal will not compromise the implementation of the Rice Competitiveness Enhancement Program (RCEP). He explained that the P10 billion in tariff revenues required to fund the RCEP have already been met by this year’s tariff collections.
Salceda also “strongly suggests” that the rice-tariff reduction “should be accompanied by more aggressive palay-buying operations by the NFA to ensure that the surge in imports does not unduly depress farmgate prices.”
He noted the move is allowed by the Rice Tariffication Law: It “allows the NFA to source palay locally.”
However, Salceda said the long-term and sustainable solution is still to produce more rice domestically in a way that is resilient to climate risks.
“Actually, the PBBM administration has achieved a 3-percent growth in palay harvest for 2023. We are poised for a bumper crop year this year. We need to reduce our dependency on rice imports to protect us from rice trade volatility. That is the direction of this administration,” he added.
Earlier, Finance Secretary Benjamin E. Diokno said reducing the rice tariffs temporarily to zero or up to a maximum of 10 percent would help in “arresting” the surge in local rice prices.
‘Nail in the coffin’
BUT Assistant Minority Leader and Gabriela Rep. Arlene D. Brosas expressed opposition to the DOF’s proposal to temporarily slash the tariff rates for rice imports from 35 percent to zero.
“Only the largest rice importers benefited from the Rice Liberalization Law [Republic Act 11203]. This proposal by the DOF will ensure another huge volume of rice imports, which will further benefit big cartels as rice can be easily smuggled,” Brosas added.
The lawmaker said that while the recent imposition of a price ceiling can only do so much, lowering or removing tariffs is not the solution.
According to Brosas, the government promised four years ago that RA 11203 “would improve farmers’ productivity and food security.”
“But now, with the current state of our rice industry, import dependency and the trade deficit worsened, while rice self-sufficiency and farm gate prices plummeted,” she said.
Image credits: Nonie Reyes
