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Gov’t to continue allowing private sector to import rice under new rules

May 09 2017

May 08, 2017 (by Manila Bulletin)

 

By Bernie Cahiles-Magkilat 

The government will continue allowing the private sector to import rice but the Department of Agriculture has to craft regulations to ensure there is no flooding of imported rice and put up a protective mechanism for local rice farmers.

Trade and Industry Secretary Ramon M. Lopez told reporters yesterday after his speech at the 18th RCEP Trade Negotiating Committee (TNC) Meeting and Related Meetings that President Duterte has with the economic managers to continue allowing the private sector to import rice.

The National Food Authority (NFA) will not be allowed to monopolize rice importation, but its main purpose is to purchase local palay from rice farmers. NFA may also import rice when needed.

This policy is also aligned with the government’s decision to lift the quantitative restriction on rice importation by July 1 this year. An Executive Order has yet to be issued on this.

Lopez explained that the government had already lost a cumulative R200 billion before because of the NFA monopoly on rice importation because by the time the imported rice came, prices had already gone. “We end up selling at a loss,” he said noting that the private sector knows the timing and market competition will play a significant role in terms of pricing and volume of imports.

Aside from dismantling the NFA monopoly, Lopez said the other benefit is that the government will no longer allocate any budget for rice importation.

Besides, the private sector will have to pay the 35 percent tariff for imported rice creating another revenue stream for the government.

While market competition could ensure no price collusion or cartel among the importers, Lopez said the Department of Agriculture may still come up with some rules on the quantity of rice importation depending on their projection of harvest and demand.

The DA, he said, would ensure that farmers are protected. This decision may be issued through an EO or just through the NFA Council.