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Philippines in talks with neighbors on rice


Reuters
First Posted 15:07:00 03/31/2008

Filed Under: Agriculture, Food, rice problem

HONG KONG -- The Philippines is in talks with some neighboring countries to secure additional rice supplies following its purchase agreement with Vietnam, President Gloria Macapagal Arroyo told Reuters in an interview on Monday.

"The Vietnam supplies should cover it, but for redundancy we are talking with other countries as well," she said, referring to additional measures Manila was taking to ensure adequate supplies.

She declined to name the countries but said: "They are neighboring countries in the region."

The Philippines, one of the world's biggest rice importers, has said it could buy up to 2.2 million tonnes this year in what could be its biggest overseas purchase of the grain in a decade as the government worries about the political fallout from rising prices.

The country's estimated 90 million people consume 33,000 tonnes of rice per day, and the government is trying to contain a surge in prices of the staple by securing guaranteed supplies.

Possible sources for the grain will be Thailand, China, Pakistan, Australia, the United States and India.

Arroyo, in Hong Kong to deliver a speech at a Credit Suisse investment conference, reiterated the 2008 growth forecast for the Philippine economy at 6.3 percent to 7.0 percent.

Last week, the Economic Planning Secretary Augusto Santos said the government was reviewing the growth target, which is a moderation from 2007's 7.3 percent because of the slowdown in the United States, the Philippines' largest trading partner.

Arroyo said the economy was on track to achieve a balanced budget in 2008 provided the slowdown in the US economy is brief, while hinting that any other scenario could see the Southeast Asian nation finish the year with a budget deficit.

"We have talked to creditors and fund managers and they feel they can accept a small deficit as long as they see an increase in tax efforts," she said, referring to a scenario in which the US slowdown is more prolonged.

Last week, Budget Secretary Rolando Andaya said slower revenues due to weaker economic growth and the need to spend more could jeopardize the Philippines' goal of balancing its books by 2008.

But tax revenues remain robust.

Philippine tax collections in March were in line with those in January-February, Arroyos said and later specified in her speech that tax revenues were up 17 percent in the year to date.

Philippine tax collections rose 17-18 percent in February and 11.5 percent in January, according to official data. Arroyo is under pressure to improve tax collection after missing targets last year due to widespread evasion.

(Reporting by Umesh Desai and Dominic Whiting; editing by Anne Marie Roantree and Ken Wills)



Copyright 2010 Reuters. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.



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