By Jasper Emmanuel Y. Arcalas and Jovee Marie N. dela Cruz
Removing the rice-import quota, which allowed the government to limit the volume of rice that would enter the Philippines, would not only benefit consumers but also retailers, according to industry groups.
Jaime O. Magbanua, president of the Confederation of Grains Retailers Association of the Philippines Inc., said retailers could earn more if they would sell cheaper rice produced by neighboring Asean countries.
“It’s possible that retailers could increase their profit margin, given that the rice produced in neighboring countries is cheaper than ours,” Magbanua said in an interview.
He added that rice from Thailand and Vietnam would still be “way cheaper” than those produced locally even if the government would slap a 35-percent tariff on imports.
“Ordinary retailers’ only concern is if they have rice to sell and whether their profit margin would be enough,” Magbanua said.
Among the stakeholders in the rice sector, Philippine Confederation of Grains Association Inc. President Herculano Co said rice traders would be “least affected” by the removal of the rice quantitative restriction (QR).
“The rice traders and retailers would be the least affected and may even benefit as their only concern is the marketing of rice,” Co said.
He added that the government should just lift the QR on rice as it fell short on its promise to develop the agriculture sector and prepare rice farmers to be competitive in Asean.
“If they want to extend the QR for two more years then the government should come up with a concrete plan on how they will help our Filipino rice farmers, such as providing better postharvest technologies, hybrid and stronger seeds, as well as free irrigation,” Co said.
“Because if not, then better lift the QR because our friends from other agriculture sectors, such as hog raisers and poultry growers, are being compromised just to have it extended,” he added.
Co and Magbanua said it is high time for the government to prioritize Filipino rice farmers as they would be hardest hit by the lifting of the QR on rice.
“If the government can [help] other Philippine sectors, then why can’t they fund [programs] for our rice farmers? Programs and projects that would benefit rice farmers would be more than enough to encourage them to continue planting rice,” Magbanua said.
Earlier, Agriculture Secretary Emmanuel F. Piñol said the government should ask the World Trade Organization (WTO) to extend the rice QR for another two years to prepare rice farmers.
The Department of Agriculture (DA) is all set to start consultations with stakeholders from the rice industry next week to determine whether they are amenable to removing the rice QR, according to Agriculture Undersecretary Segfredo R. Serrano.
According to the WTO General Council ruling released in July 2014, the Philippines should subject rice imports to ordinary customs duties right after the QR-waiver extension expires on June 30, 2017.
Under the QR, rice imports within the minimum access volume (MAV) of 805,200 metric tons per year are slapped with a lower tariff of 35 percent, while imports in excess of the MAV are slapped a higher tariff of 50 percent.
Serrano said the DA is willing to increase the volume of rice currently allowed to enter the country under MAV, should the government decide to renegotiate the extension of the rice import quota.
‘Retain rice QR’
A party-list lawmaker on Tuesday backed the plan of Piñol to extend the QR on rice for another two years.
Party-list Rep. Tom Villarin of Akbayan told reporters in an interview that lifting the restrictions could lower rice prices but would hurt local farmers.
“I was the one who’s pushing the DA to extend the QR and Piñol acknowledged it,” Villarin said.
The lawmaker also asked the National Economic and Development Authority (Neda) to explain its decision to push for the removal of the QR on rice.
“For the longest time, we’ve been buying from other rice-producing countries. Are we now saying that we can compete with them?” Villarin said.
The lawmaker said he has already filed House Resolution 392 that seeks to clarify the possible implications of lifting QR on rice in view of its impending removal next year.
Villarin said Congress, through the Special Committee on Globalization and WTO, must “extensively study” the implication of the full liberalization of rice trade for small farmers, ordinary consumers and the country’s strategic food-security goals.
“The Neda and the DA must disclose to the public the policy adjustment the administration will make in order for the affected sectors to cope with the lifting of QR on rice,” he said.
Villarin added the Tariff Commission and other appropriate agencies should also reveal how the current tariff and nontariff regimes for rice have fared in terms of providing actual protection to rice farmers.