Experts Say Rice Tariffication Gets Better With Gov'ts Support to Local Farmers - BALITANG PINOY

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Friday, February 22, 2019

Experts Say Rice Tariffication Gets Better With Gov'ts Support to Local Farmers

Manila-- After rainstorms of conceptions, experts said on Friday that the liberalization of rice imports will get better with the government's support programs to make domestic farmers more productive.

"I think on the one hand, the liberalization of the rice market is a good thing but it has to come hand in hand with more subsidies, more support for domestic rice producers because you don’t want to get into a situation where you’re only dependent on imported rice," The Economist Intelligence Unit analyst Anwita Basu said in an ANC interview.

A researcher of the Philippine Institute for Development Studies also suggested three support mechanisms to assist farmers in the rice tariffication passage.

"Compensating farmers not enough to help them; we have to create safety net for them," Dr. Roehlano Briones said.

"I would describe the strategy laid out in the rice taruffication Act as traditional, by adding more on the same types of support that we already providing to huge extent to the rice sector in the Philippines," he further said.

He said that aside from the traditional support, one compensation that can give to farmers was
through deficiency payments wherein by looking at the price and providing price guarantee when the import regime kicks in.

Aside from the two safety nets given, Briones said the coupled payments can also help local farmers since it has been proven effective in other countries.

"This is being adopted by many countries worldwide, coupled support where you provide compensation to the farmer without any conditionalities.. that they continue to farm or harvest a large amount, that the more you harvest, the more payments you get. It creates a style that tends to what we call provided distortion."

Briones said that creating a distortion in the decision making provides an artificial incentive.

"So once artificial incentive was take out if a farmer lost income by our policy so here's the compensation, as I've mentioned," Briones added.

Under this new rice tarrification law, the price of the rice will get lower by making it more affordable to the rice-consuming public, which allows unlimited importation of rice as long as private sector traders secure a phytosanitary permit from the Bureau of Plant Industry and pay the 35-percent tariff for shipments from neighbors in Southeast Asia.

This law seeked to liberalize rice importation by replacing quantitative import restrictions with tariffs, bringing it down to P2 to P7 per kilo as stated by Finance Assistant Secretary Tony Lambino.

Under its measure, allotted funds required upon passage of P10 billion for the Rice Competitiveness Enhancement Fund, of which P5 billion will be allotted to farm mechanization and P3 billion to seedlings. The fund intends to ensure that rice imports won’t scarce the agriculture sector and rob farmers of their livelihood.

Meanwhile, other lawmakers, rice farmers, grain retailers and other stakeholders still growl for their businesses and works that would have a huge impact on the livelihood.

The group of Kilusang Magbubukid ng Pilipinas said the law would directly affect the livelihood of 13.5 million rice farmers and 17.5 million farmworkers and their families.

The same with Alliance of Concerned Teachers (ACT) party-list Rep. Antonio Tinio who said that rice tarrification law will worsen the situation and just succeed the rice cartels of the country.

"The enactment of the rice tariffication law will be another broken promise by the Duterte administration as this measure will only worsen poverty and hunger and will only cater monopoly traders whose primary mission in life is to profit," he said.

Earlier, Duterte explained to Congress that rice tariffication law is an urgent need to improve availability of rice in the country, prevent artificial rice shortage, reduce the prices of rice in the market and curtail the prevalence of corruption and cartel domination in the rice industry.

Trade Secretary Ramon Lopez, then said that the President believed "in giving what is best for the greatest number of Filipinos."

"He believes in the principle of and benefits of having lesser government intervention and allowing the interplay of market forces, while providing the needed safety nets to affected sectors," Lopez said.

Presidential Spokesperson Salvador Panelo added "Good governance is the hallmark of the Duterte Administration and the President has zero tolerance against corruption and wastage of taxpayers' money."

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