Economic managers back tariffication
Philippine economic managers on Tuesday stressed the need to approve the proposed rice tariffication to ensure adequate rice supply and help address the rising inflation rate.
In a joint statement by the Department of Finance (DOF), Department of Budget and Management (DBM) and the National Economic and Development Authority (NEDA), the top economic officials said an amendment of Republic Act 8178, otherwise known as the Agricultural Tariffication Act, is necessary to replace the quantitative restrictions on rice importation.
The proposed rice tariffication, it said, “will significantly improve the rice market, bringing down the price of the grain.”
“This reform in agriculture will also provide a PHP10-billion enhancement fund for rice farmers that will help them have better access to technology, and thereby, ramp up their production,” it said.
Earlier, Finance Secretary Carlos Dominguez III said the passage of the proposed rice tariffication bill, which President Rodrigo R. Duterte has declared as an urgent and priority measure, “will complement the social mitigation measures we are implementing now to further ease the impact of inflation on poor households.”
The proposal is seen to bring down rice prices in the domestic economy by as much as P7 per kilo, a big help for consumers since the commodity accounts for about 20 percent of low-income Filipinos’ consumption.
The Philippine Statistics Authority (PSA) reported that inflation rose to 5.7 percent last July from month ago’s 5.2 percent, primarily due to faster rate of price increases of food and non-alcoholic beverages index at 7.1 percent.
It explained that “compared from their annual rates in June 2018, all the food groups posted higher annual increments in July 2018 except for the indices of corn and fruits.”
In particular, rice, which has a 9.59 percent weight to the overall inflation, posted a 5 percent year-on-year rate.
The economic team’s statement said rice stocks last July stood at 2.36 million metric tons (MT), lower by 8.2 percent from year-ago’s 2.57 million MT and this was traced partly to “weather disturbances in the country and in other rice-producing countries like Thailand and Vietnam.”
With the sustained rise of inflation, the economic managers cited the need for “stronger government measures, most especially in improving agriculture productivity and, in the short term, a strategic trade policy.” (PNA)