Neda chief says rice imports, though hurting farmers, is for greater good

For the greater good.

The country’s chief economist on Tuesday, Nov. 19, said this was the objective of removing restrictions on rice imports which he said benefited poor families and tamed inflation although hurting local farmers.

Socioeconomic Planning Secretary Ernesto M. Pernia said the Duterte administration had already put in place measures to cushion the impact on rice farmers of the law that removed volume restrictions on rice importation subject to tariffs.

Pernia, who heads the state planning agency National Economic and Development Authority (Neda), said the Cabinet approved the distribution of up to P3 billion in cash to farmers financially hurt by the influx of imported rice which depressed prices of unhusked rice, or palay.

The P3-billion will come from tariff collection from imported rice exceeding the P10-billion Rice Competitiveness Enhancement Fund (RCEF).

If the government backtracked on liberalized rice importation, Pernia said “we will be back to where we were last year” when supply bottlenecks caused runaway inflation and raised rice prices to nearly P50 per kilogram.

If imports were stopped or restricted again, supply would be tight, prices will rise and “the poor will suffer,” Pernia said.

He said bulk of Filipino families’ expenses are on food.

Partly because of improved supply as a result of rice imports, Pernia said inflation for the 30 percent poorest households had gone down to 0.9 percent which meant “the bigger majority is benefiting.”

The latest Philippine Statistics Authority (PSA) data showed that the consumer price index (CPI) for the bottom 30-percent income households in October fell to a 46-month low of 0.9 percent year-on-year as food prices and cost of utilities declined year-on-year.

In a press conference last Monday, International Monetary Fund (IMF) mission chief Thomas Helbling described the lifting of volume restrictions on rice imports as a “major step forward” that had been long overdue.

“I think rice tariffication—that is to move from import quotas to import tariffs—is helping the broader population.,” Helbling told reporters.

“We would also know that, of course, rice farmers may suffer from this but the government has instituted income support for affected farmers,” Helbling said./Edited by TSB