By: Artchil B. Fernandez
A sector is dying in the country. Its death knell was sounded by Du30 when he signed Republic Act No. 11203 or the Rice Tariffication Act. The present administration has a nasty and brutal sense of humor, signing the law on Valentine’s Day.
RA 11203 amended RA 8178 or the Agricultural Tariffication Act of 1996 which impose quantitative restriction (QR) on rice importation. QR limits the volume of rice entering the country. Under the new scheme, anybody can import rice as long as they pay the required tariff.
Rice tariffication law was one of the measures pushed by the economic managers of Du30 to combat inflation, specifically the high prices of rice last year. Inflation last year reached 5.2 percent hitting hard the pockets of the poorest section of the population. Filipinos largely blamed the tax reform law of the administration for sudden rise inflation. Lifting restrictions on rice imports the administration hoped will flood the market with cheap rice in effect lowering the price of the staple food of Filipinos.
The public, particularly Filipino consumers were promised paradise with Du30’s signing of RA 11203. Consumers will get affordable rice its proponents trumpeted. The Bangko Sentral ng Pilipinas (BSP) pitching for the law projected the price of rice will be slashed by at least 7 pesos.
Before RA 11203, it is the National Food Authority (NFA) using government funds to import rice albeit limited. Under the law, private individuals and enterprises can import rice (provided they pay tariff) thus freeing the government of the financial burden. Apologists of Du30 hailed the administration for coming up with a brilliant idea (use of private funds) to buy rice for Filipinos and proclaimed that RA 11203 could be Du30’s enduring legacy.
Jose Abeto Zaide in his Manila Bulletin column (8/5/19) called RA 11203 an idea whose time has come. The ultimate objective of the law according to him is “to give to our farmers (rather than to the foreign suppliers) the incentive and just rewards to raise their quality of life, enabling them to buy food, clothing, shelter, education for their family, etc. This multiplier effect creates jobs, engenders peace and order, prosperity and wellbeing to everybody and not only to the farmers. This is the best way to pull our people out of poverty. (It may even encourage urban informal settlers to return to the farms where there is employment and livelihood opportunity.)”
Reality punctured such rosy projection of the administration. Six months into the implementation of the law, the promised paradise of the RA 11203 is turning out to be a nightmare, particularly to Filipino farmers. And the promised cheap rice to Filipino consumers remained a promise.
Government economists were reported to be surprised (really?) that the projected benefits of RA 11203 did come to pass. They expected the price of rice to drop to P27 per kilo with rice importation. Figures from the Philippine Statistics Authority (PSA) show that currently, regular milled rice retails at P38.4 per kilo, while well-milled rice is priced at P43.5 per kilo.
The situation of Filipino farmers under RA 11203 worsened. Cheap imported rice flooded the market. This caused the plummeting of the farmgate price of palay (unhusked rice). Last year, without RA 11203, farmers sell their palay to traders at P22 per kilo. With RA 11203, the farmgate price of palay dropped to P17 per kilo. In some areas in Central Luzon, particularly in Nueva Ecija, farmers were forced to sell their palay at P7 to P8 per kilo just to compete with imported rice. The cost to produce a kilo of palay is P12. In contrast, the farmgate price of palay in September last year increased by 19%.
Filipino farmers are at the losing end of RA 11203. Instead of uplifting the lives of the farmers as promised, the law is slowly killing the farming sector. The administration’s heartless response to the current woes of Filipino farmers is to offer them P15,000 loan at zero interest payable in 8 years, a measly amount.
Passage of RA 11203 once again exposed the ineptness, insensitivity and sinister nature of Du30 and his administration.
It is very clear RA 11203 was signed by a thoughtless and heartless Du30 who did not study the implications of the measure or saw only one side of it. He was so focused on the prospect of a lower price of rice (which also did not happen) with the flood of cheap imported rice. The impact of the law on Filipino farmers and the agriculture sector were obviously ignored or never considered at all by him.
It is also possible that Du30 and his cohorts saw in high inflation last year an opportunity to remove restrictions on rice importations. With the removal of QR on rice imports, rice cartels found a way to flood the market with cheap imported rice and manipulate the market to their advantage. It is quite obvious the low price of palay and high price of milled rice is the product of market manipulation by rice importer cartels to gain a windfall of profit at the expense of poor Filipino farmers and hapless consumers.
Death of rice industry and impoverishment of Filipino farmers are of no concern to rice importer cartels as long as their bank accounts are fattened. Du30’s signing of RA 11203 is a golden opportunity for them to advance their sinister and greedy agenda. Was Du30 naïve when he signed the law or was he in league with the rice importer cartels? Many of the oligarchs surrounding Du30 are involved in the importation of cheap rice.
Philippine agriculture is dying abetted no less by the Du30 administration. During the campaign, Du30 promised to prioritize and revitalize the farming sector. This is another broken promise, joining the long list of broken promises of Du30. His administration is not just an administration of broken promises but of broken dreams.