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Philippine rice funding to hit $421M with new law

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Philippine rice funding to hit $421M with new law. PHILIPPINE DAILY INQUIRER/ANN

Philippine rice funding to hit $421M with new law

GOVERNMENT funding for the country’s rice industry is set to hit a record of 22 billion pesos ($421.531 million) this year with the implementation of the Rice Import Liberalization Law, the agriculture chief said.

In an interview with reporters on Monday, Agriculture Secretary Emmanuel Pinol said with funding from the national government along with the agency’s budget for the sector, “the rice industry will be given the biggest budget in history”.

Last week, the Department of Budget and Management released five billion pesos to the Department of Agriculture (DA) to protect rice farmers against the possible adverse effects of the Rice Import Liberalization Law.

This is on top of the annual 10-billion-peso subsidy under the Rice Competitiveness Enhancement Fund, which aims to cut the cost of producing rice so local farmers may be able to compete with the influx of more affordable imported rice.

DA has also allocated seven billion pesos of its funds to rice.

In total, the rice industry will get 32 billion pesos for its development.

“This is actually the greatest irony,” the secretary said. “Farmers are worried with the implementation of this measure but it’s also now that they will be getting this kind of financial assistance.”

The measure, which was expected to be implemented on Tuesday, removes the regulatory and importing function of the National Food Authority and allows the expansion of the private sector’s role in the market. Shipments would be charged tariffs of between 35 per cent to 50 per cent, which would be used for the industry’s modernisation.

Economic managers said the law could cut retail rice prices in half and ease inflation by 0.5 to 0.7 per cent.

During the DA’s nationwide consultation with industry stakeholders last week, Pinol said farmers only wanted assurance from the government that the unimpeded entry of imported rice would not pull farm-gate prices of paddy down.

Last year, the farm-gate price of paddy reached its highest at 24 pesos per kg, but following speculation that imported rice will flood the market, prices in some provinces dipped to 15 pesos per kg.

But according to Pinol and officials from socioeconomic planning agency National Economic and Development Authority, such worry is misplaced.

Pinol admitted that the government’s intervention should have been implemented as early as last year, but bureaucratic processes have been derailing the budget’s release.

This is the reason government agencies are scrambling to complete the law’s implementing rules and regulations (IRR). Pinol said the IRR would be ready on Tuesday.

“There are calls from other industry stakeholders that the formulation of the IRR should be extended but I’m against that. The longer we wait, the longer it will take for the budget to be released. That’s one planting season lost for us,” he said.

The IRR tackles the details of the law, including the government’s safety nets for local farmers who may be affected by the industry’s liberalisation. It will also explain in detail the importation process and the transition of various agencies to the new rice regime. PHILIPPINE DAILY INQUIRER/ANN

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