January 09, 2019

MANILA—The immediate enactment into law of the rice tariffication bill is fundamental in the government’s efforts to stabilize food prices and overall inflation rate, the National Economic and Development Authority (NEDA) said.

Reiterating the urgency of the bill’s signing into law, Socioeconomic Planning Secretary Ernesto M. Pernia said that through rice tariffication affordable rice can be obtained from various sources and need not be the sole responsibility of the National Food Authority (NFA).

The rice tariffication bill amends the two-decade-old Republic Act (RA) No. 8178, otherwise known as the Agricultural Tariffication Act of 1996, and replaces the quantitative restrictions (QR) on rice imports with tariff.

The bill, which was ratified by both chambers of Congress on November 28, 2018, is set to be transmitted to Malacañan for the President’s signature.

“The aim of the bill is to make rice accessible and affordable to every Filipino, and to make the rice sector competitive,” Pernia said.

Under the new rice importation regime, legitimate rice traders can now import rice sans NFA permits, provided they secure a sanitary and phytosanitary import clearance from the Department of Agriculture-Bureau of Plant Industry (DA-BPI) and pay the appropriate tariff to the Bureau of Customs.

The NFA, on the other hand, will focus on ensuring sufficient buffer stocks to address emergency situations.  As there is a need to periodically replenish the buffer stocks, NFA can still sell cheap rice, but to very targeted markets.

“In selling rice, the NFA may opt to focus on far-flung areas, which some private traders may not find profitable to serve,” Pernia said.

Even with rice tariffication, rice subsidy under the government’s conditional cash transfer program or the Pantawid Pamilyang Pilipino Program would still continue benefiting poor households.

Through the establishment of theRice Competitiveness Enhancement Fund (RCEF) coming from the tariff revenues, the DA, meanwhile, will have an additional source of funding for its programs and projects to increase the productivity and enhance the competitiveness of the sector, Pernia noted.

Key interventions to be financed by the RCEF include farm machinery and equipment to improve farm mechanization, rice seed development, propagation and promotion, expanded rice credit, crop diversification, and extension services.

A portion of the rice tariff revenues in excess of PhP10 billion will be used to provide direct financial assistance to rice farmers.

The rice tariffication bill also provides safety nets to the rice sector as it grants the President emergency power to increase, reduce, or adjust existing tariff rates to safeguard Filipino farmers. The bill also provides the imposition of a special safeguard duty on rice in case of extreme or sudden price fluctuations in accordance with RA 8800 or the Safeguard Measures Act.

In the event of possible rice shortage, the bill empowers the President, for a limited period and for a specified volume, to allow importation at lower rates for the benefit of consumers.

Pernia, likewise, urged the DA, along with the Department of Trade and Industry and other concerned agencies, to carry out information dissemination campaigns on the new rice importation regime and ensure that rice traders are ready to participate when the bill is enacted into law.

“Increasing the number of market players and competition in the rice sector are critical for the bill to deliver on its promise of lower rice prices for everyone,” Pernia said.