Rice prices to rise if imports stopped: ex-economic managers


Posted at Apr 12 2017 09:24 AM | Updated as of Apr 12 2017 09:51 AM

MANILA – Rice prices could go up if government bans imports of the staple grain, a trade advocacy group composed of former economic managers said.

The Foundation for Economic Freedom also urged President Rodrigo Duterte to liberalize the rice trade by removing the “monopoly” of the National Food Authority on imports.

The group pushed for tariffs on rice imports so that revenues could be used to help farmers shift to higher-value crops.

“Stopping all rice importation as Agriculture Secretary (Emmanuel) Pinol wants is a dangerous policy that could lead to significant shortages and increased rice prices,” the FEF said in a statement late Tuesday.

Pinol said there was no immediate need to import rice due to projections of a good harvest.

Duterte last week fired deputy cabinet secretary Maia Valdez following alleged disagreements with NFA administrator Jason Aquino on the country’s rice importation policy.

On Monday, Duterte ordered the NFA to buy rice from local farmers first before importing.

Allowing only the NFA to import rice is the “wrong policy” since this would slow the process and provide opportunities for corruption because of the lack of competitive bidding, the FEF said.

“Decisions to import are best left to the private sector since it is in the interest of the private sector to import at the lowest possible price and in an amount that will not lead to an oversupply,” the group said.

The NFA, the government's food security watchdog, is required to maintain a rice stockpile good to last for 15 days at any given time and for 30 days at the onset of the lean months. As of February, the stockpiles were sufficient for only 14 days.

The agency said on Monday that it needed to buy 490,800 tons of rice to boost its stockpiles that have fallen below the required level ahead of the July to September lean harvest season. -- with a report from Reuters