Tag Archives: Rice Tariffication Law

[Featured site] Nagkakaisang Boses Laban sa RTL

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Ang Nagkakaisang Boses Laban sa RTL ay isang espasyo upang talakayin ang isyu ng Rice Tariffication Law sa mga magsasaka at konsyumer ng bigas at palay sa Pilipinas

 

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[Statement] Rice liberalization is a clear abandonment of the local rice farmers and industry -PMCJ

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STATEMENT ON THE PASSAGE OF RICE TARIFFICATION ACT

The Philippine Movement for Climate Justice (PMCJ) calls on the government to institute more safeguards and protection for rice farmers and the rice industry now that the rice tariffication act has been signed into law.

On February 14, President Rodrigo Duterte signed into law Republic Act No. 11203, also known as the Rice Tariffication Act, which will lift the quantitative restrictions on rice imports and allow the private sector to import ‘unlimited’ rice with much ease as long as it pays the tariff set by the law. Duterte and his economic managers asserted that it would address the urgent need to improve the availability and affordability of rice in the country.

Rice liberalization is a clear abandonment of the local rice farmers and industry

Ever since the Philippines liberalized agriculture, many of its agricultural products failed to compete with the cheaper counterparts of the Southeast Asian countries. The price of the agricultural product has always been the determinant in its viability in the market as shown by the cheaper onions and garlic imports vs. the expensive locally produced ones. Eventually, the number of Filipino farmers producing onions and garlic dwindle and lands devoted to producing these products have been converted for other use. This has been the hard lesson the Philippines got from agricultural liberalization, and fears that this is happening again to rice, the most basic staple of Filipinos.

With the flooding of cheaper imported rice in the local market, how can the local rice farmers compete with their foreign counterparts? Farmers will be forced to sell off their harvest to a much lower price amidst the increasing local cost of production. Although the law provides that collected tariffs will be allocated to farm mechanization, seed development, credit assistance, and training services to help farmers adjust, it will still take time for every farmer to actually benefit from it. And this is even under the assumption that the law will successfully be implemented. Farmers would still have to endure the sudden loss of income they will incur upon full implementation of the rice tariffication act, trapping them further in the cycle of poverty.

Given their poor economic conditions, compounded with the lack of implementation for policies protecting small-scale farmers, incomplete implementation of agrarian reform, degradation of watersheds and forests for irrigation, and now opening up the rice industry to other players, the number of farmers involved in rice farming will most likely shrink as well as the agricultural lands devoted to it. Shift to other profitable commodities is expected, or worse the conversion of rice lands to non-agricultural uses.

On the other hand, there is no guarantee that rice prices will lower and stabilize despite the influx of cheaper imported rice. With the new law, the private sector now holds the power to control and dictate market prices. The National Food Authority, which had the previous mandate of stabilizing prices, is now merely tasked of maintaining sufficient rice buffer stock intended for calamities and emergencies. This is a double whammy for the poor farmers being both producers and consumers of rice.

Rice liberalization is not the key to food security, but self-sufficiency

Rice liberalization is a myopic move from the government as it fails to recognize the current global climate crisis. The world, as it is, already goes through the dramatic consequences of climate change on food production. And this is expected to get worse in 12 years time, according to IPCC’s Special Report on Global Warming of 1.5 degree Celsius, if no unprecedented transitions in all aspects of society are done. By 2030, there will be a drastic decline in agricultural yields including rice, corn, and wheat. Rice yields reduction will reach up to 10% for every 1 degree Celsius increase in temperature, or even higher for climate vulnerable countries such as those in Asia.

Vietnam and Thailand, the world’s largest rice exporters and the main sources of imported rice in the Philippines, will soon not be able to export the same volume of rice as they do now because of the worsening climate change impacts to their agriculture sector. Given this situation, the Philippines will face another rice crisis in a few years if its rice industry will remain import-dependent.

Safeguarding food security does not mean sustaining the country’s food supply through whatever means, in this case, importation. It means protecting the local production and transforming it to an adaptive, resilient, and self-sufficient industry that can cater to the local demands for food. At the same time, it means putting a premium on the rights and well-being of local food producers and building their capacity to sustain the local food demands. A country with more than enough domestic food supply is in a better position to face the impending food crisis due to climate change than a country with an import-dependent food system.

In the event of signing the Rice Tariffication Act into law, PMCJ calls on the government to expand and develop local rice production by ensuring that agricultural services, regulation of the cost of production and access to low-interest credit and grants are available to small rice farmers. Protection and expansion of rice farms and small farmers is the key to climate impacts on rice and food production. Conservation of watersheds and forests for irrigation and water supply is critical to sustaining agricultural productivity, as well as complying with our mitigation targets. Further, it calls on the government to stop the tide of liberalization of agriculture and institute reforms and policy to enhance and develop local agricultural production devoted to food consumption of the 100 million Filipinos.

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[Statement] R.A 11203 will lambast the Philippine economy backbone -PNFSP

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R.A 11203 will lambast the Philippine economy backbone

We rise in behalf of the farmers and consumers who will be affected by the rice liberalization law, putting their right to food safety and food security in jeopardy, as yesterday, March 5, marked the start of rice liberalization in the country, after R.A 11203 known as the Rice Tariffication Law was officially introduced to the public through its Implementing Rules and Regulation (IRR). There’s no assurance that this may address food shortage given that the vitality of the world market itself is fluctuating yearly. And has no assurance that the rice Filipinos will eat is safe as it may be genetically modified (GMO’s) or contaminated.

Instead, this approach of the government will de-stabilize commodity prices and the economy as a whole leaving ordinary Filipinos behind, while big traders may enjoy importing 1,185,764 metric tons of rice based on NFA’s list of Out-Quota Rice Importation of the Private Sector as of January 18, 2019. With the passage of the Rice Tariffication Law, the expected volume of rice imports may reach to almost 4 million MT, the highest volume of rice imports surpassing the 2010 importation of 2.45 M MT.

According to President Duterte’s economic managers, the law will bolster local rice supply and produce revenues to enhance local Philippine rice industry. The feasibility of bolstering local rice supply and producing revenues lies on the narrative that “the new law completely abolishes quantitative restrictions (government control) to ensure a steady supply of rice in the domestic market through importation.” Yet, higher and unregulated tariff rates would be smacked on imports. The tariffs, set at 35%, would now serve as the control mechanism instead of an explicit limit on imports through quantitative restrictions. But, these are all short-sighted analogy including the 10 billion pesos (RCEF) that will use annually to develop the local rice industry.

Rice influx may affect rice producing provinces. It would imperil rice granaries provinces that include Nueva Ecija, Isabela, Pangasinan, Cagayan, Iloilo, Camarines Sur, Aurora, Bataan, Bulacan, Nueva Ecija, Pampanga, Tarlac, and Zambales. In 2017 Central Luzon contributed 0.6% from the 6.7% growth of the Gross Domestic Product. Under the law, market forces, not government interventions, will prevail, but it seems that the production is not. In economic theory, competition will bring prices down.

The implementation of Rice Tariffication Law is a big slap to the country’s program on agriculture and the capacity to uphold food security and self-sufficiency. Instead of strengthening the agricultural and peasant sector by pursuing genuine agrarian reform and rural industrialization, the government has just abandoned its role and practically opened the country to foreign interest. The policy of liberalizing the country’s agriculture, the rice industry, and the economy, are assaults to the country’s sovereignty. There are better and more appropriate parameters to reform the rice and agriculture industry such as the passage of the Rice Industry Development Act (RIDA) and the Genuine Agrarian Reform Bill (GARB).

For reference:
Renmin Vizconde
Executive Director

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[Statement] Enacted Rice Tariffication Law Will Not Resolve Food Security -PNFSP

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Enacted Rice Tariffication Law Will Not Resolve Food Security

Philippine Network of Food Security Programmes condemns President Rodrigo Roa Duterte’s signing of the Rice Tariffication Bill. This had just justifies that there is no hope for the Philippines to achieve food security. Hence, it will further liberalize Philippine rice industry by replacing quantitative restrictions due to uncontrolled rice imports, and will displace rice farmers and worsen poverty and hunger. It will not resolve the Filipino’s problem on high prices of rice and other agricultural commodities, but will only worsen the inaccessibility to buy food for their families. The law is extremely in favor to rice cartel, traders and capitalist and not to common Filipinos, especially the farming sector, who are suffering due to extreme and unprecedented economic instability.

The government is using high inflation to justify rice sector liberalization according to long-standing demands of the World Trade Organization (WTO) and big foreign agricultural exporters. Under the conditions of neo-liberal GATT-WTO guidelines, all country signatories can only “monitor” the flow of economic mobility. “Regulation” and “control” is within the task of the international body, not local body. For the past years, the Philippine government intervention in the rice market is lessened while quantitative restrictions on rice imports are “replaced” with “tariffs”.

The Rice Tariffication Law removed strong, decisive and tough government control on all agricultural commodities and obliged domestic market to join and spend unnecessary resources to global rice market and competition. The law is a burden to all Filipinos especially the 60 million poorest of the poor families. On the other hand, uncontrolled rice imports will drive rice farmers into worse poverty. If the Philippines imports two million metric tons of palay, for instance, some 500,000 of around 2.4 million rice farmers will be adversely affected. Even the government’s own Philippine Institute for Development Studies (PIDS) projects a 29% decline in rice farmers’ incomes from a Php4-decrease in palay farm gate prices when rice tariffication is implemented.

In a country where landlessness, joblessness and homelessness are proliferating, the law is a deadly decision against Filipino rice farmers wherein domestically-produced rice is unnecessarily expensive because of “long-standing government neglect of the agriculture sector.” No more than 5% of the national budget has been given to agriculture over the last two decades. The Duterte administration does not correct this, but instead passed a law that will further burden the Filipinos.

There is no guarantee that retail rice prices will be lower in the long run with unrestricted importation. Relying on rice imports makes the country vulnerable to higher world market prices as well as to rice production and export decisions of other countries. Government’s neoliberal prioritization of food imports and production of crops for export should be upturned. The Philippine government should instead strengthen the local rice industry such as rural aid like free water irrigation, free calamity subsidy, post-harvest facility, and agrarian mechanization and boosting of local market. Of course, this begins with free land distribution to all willing tillers, followed by giving substantial support for rice producers, and taking control of the market to ensure reasonable prices for rice and other agricultural produce. Philippine agriculture should be strengthened with abundant government support instead of being prematurely opened up to inexpensive foreign government-subsidized import commodities from abroad. ###

For reference:
Renmin Vizconde
Executive Director

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