Bicameral body OKs rice tariffs
A bicameral conference committee has approved a bill that imposes a tariff on rice aimed at bringing down the price of the staple and at reining in inflation, which has risen to a nine-year high over the past two months.
Tariff is a tax on imports.
Another bicameral committee also approved on Thursday the coco levy fund bill and the measure that strengthens the Philippine Coconut Authority (PCA).
The removal of import caps is expected to reduce the retail price of rice by P4 to P7 per kilogram, economic managers earlier said.
Rice prices account for 10 percent of the country’s inflation, which rose to 6.7 percent in September and October and contributed to declines in President Duterte’s approval ratings.
Retail prices of the staple surged over the past few months amid the depleted buffer stock of the National Food Authority (NFA), triggering calls for its abolition. The NFA is tasked with stabilizing the supply and price of rice.
Lifting caps
The bill liberalizes rice importation by removing quantitative restrictions and instead imposing a tariff—35 percent for rice from other members of the Southeast Asian Nations (Asean) and 50 percent from non-Asean countries.
The Philippines imports rice largely from Vietnam and Thailand—both Asean members.
The government think tank Philippine Institute for Development Studies expects the price of rice to decline due to improved supply and to competition among suppliers as a result of the imposition of tariff on imported rice.
All those who could get phytosanitary and sanitary permits from the Bureau of Plant Industry and pay the tariffs could import rice, said Sen. Cynthia Villar, who led the Senate panel.
“We want to break the cartel,” Villar told reporters.
She expects Congress to ratify the measure before the end of the year so it could be sent to the President, who had certified the measure as urgent, for his signature.
The Makabayan bloc in the House of Representatives on Wednesday said it would oppose the rice tariffication bill.
Threat to livelihood
Anakpawis Rep. Ariel Casilao said once enacted, the bill would be a “doomsday clock” to local rice farmers.
“Passing the rice tariffication would mean the avalanche of imported rice in our local market. It is meant to kill not only the local rice industry but also the livelihood of millions of local rice farmers,” Casilao.
Casilao joined a rally by members of Anakpawis and Bantay Bigas near the Senate building in Pasay City to protest against the bill.
P10-B fund
They said that instead of tariffication, it was better for the government to give greater production support to rice farmers to ensure a steady supply of the staple and uplift the lives of farmers.
Revenue from the collection of tariffs on rice will go to the Rice Competitiveness Enhancement Fund [RCEF] that seeks to help Filipino farmers.
Villar, chair of the Senate committee on agriculture, said the P10-billion RCEF remained intact in the bill. “That is the most important,” she said.
Farm mechanization
The senator said the fund should ease the fears of farmers who worry that they would be unable to compete with the flood of imports.
The RCEF would be used to lower rice farmers’ high labor costs to make them competitive, Villar said.
The P10-billion fund would be used to mechanize their processes to bring down labor costs and provide them seeds that would increase their harvest.
Half of the amount would go to the Philippine Center for Post Harvest Development and Modernization to provide farmers’ associations and cooperatives with rice farm machinery and equipment.
From the fund, 30 percent would be given to the Philippine Rice Research Institute for the development, propagation and promotion of inbred seeds to rice farmers, and for the organization of rice farmers into seed growers associations.
Low-interest credit
Ten percent of the fund would be available for credit for rice farmers, with minimal interest rates and minimum collateral requirements.
The remaining 10 percent would be used for extension services by PhilMech, Agricultural Training Institute and the Technical Education and Skills Development Authority.
They would teach skills on rice crop production, modern rice farming techniques, seed production, farm mechanization, and knowledge or technology transfer through farm schools nationwide.
Diminished NFA role
Under the bill, the NFA would have a diminished role in rice importation. Its new task would be to buy rice from local farmers for the country’s buffer stock, as specified in the final version, Villar said.
Another bicameral committee also approved the final versions of the coco levy fund bill and the measure that strengthens the PCA.
The bicameral version of the coco levy fund bill was ratified in August, but this was recalled in October for additional “major” changes.
The bill allocates P10 billion a year for the coconut industry through the PCA, and P5 billion a year on programs for coconut farmers.
It puts the coconut levy fund, which was sourced from the tax that the late dictator Ferdinand Marcos imposed on coconut farmers, into a trust fund.
The changes in the bill have to do with the inclusion of a sunset provision and the composition of the council that would manage the fund.
Villar said the council would be composed of eight representatives from the government, six representatives from farmers’ groups and one representative from the private sector. —WITH REPORTS FROM JEROME ANING AND INQUIRER RESEARCH
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