Progressive groups fear new tariff law will lead to rice cartels

DAVAO CITY, Philippines (UPDATED) – Anakpawis Representative Ariel Casilao warned that the rice tariffication law, which President Rodrigo Duterte signed Friday, February 15, may have similar results as the oil deregulation law.

"It would enable cartels of the rice trade and will throw poor sectors into a worsened state of hunger. The retail prices will eventually normalize to levels dictated by dominant trading parties, but this would be at securing giant profits," Casilao said.

The new law lifts import restrictions on rice, a measure the government hopes will lower the price of the food staple to a level more affordable for Filipinos.

It amends Republic Act (RA) No. 8178 or the Agricultural Tariffication Act of 1996 and replaces the quantitative restriction on rice imports.

Instead of limiting how much rice will enter the country, rice imports will just be slapped with a tariff.

Casilao said that as what happened in the aftermath of the oil deregulation law, the rice tariffication law would pave the way for the entry of new players, but it would not lead to lower prices.

"We had a taste of being flooded with imported rice since 1995 as submission to the World Trade Organization-Agreement on Agriculture, and it never made rice affordable to the poor sectors, obviously because cartels operated," he added.

'Tombstone' for rice industry

Who would be on the losing end? Farmers, said Casilao.

"This is the tombstone for the Philippine rice industry, would bury to death the livelihood and welfare of 2.4 million rice farmers and more farm workers, along with the threat of conversion of the 4 million hectares of agricultural lands," he said.

"This will undermine the P350-billion – 19-million-metric-ton – palay sector. This is clearly a betrayal of the people's and national interest."

Casilao had proposed House Bill (HB) No. 555 or the Genuine Agrarian Reform Bill and HB 8512, the Rice Industry Development Act.

Like the lawmaker, Migrante International said the new rice tariffication law is "a death sentence to our local rice industry."

"From opening the country to the deluge of imported weevil-infested rice to bringing in more importations, this bill is the final nail in the coffin that will spell a tragic ending to the livelihood of millions of rice farmers," the group said in a statement.

'Help in easing inflation'

But House Speaker Gloria Macapagal Arroyo said she is "happy" with the signing of the rice tariffication law.

"It will further help in easing the inflation which has hit the poor the most. Now we can focus on its proper implementation so that everyone can and should benefit from the law," said Arroyo in a statement on Sunday, February 17.

Senator Cynthia Villar, sponsor of the Senate version of the bill, said the new law would take out "unnecessary intervention" by the government in rice importation.

"We thank and laud the President for signing into law the bill creating a package of support programs for farmers, most notably the P10-billion Rice Competitiveness Enhancement Fund," Villar said in a statement on Saturday, February 16.

She added: "This law complements other government programs addressing the needs of the farming sector, including the P7-billion rice program under the Department of Agriculture and the P7-billion budget of the National Food Authority which will be used to buy palay from local farmers for purposes of buffer stocking."

Senator Francis Pangilinan, for his part, said concerned groups in the rice farming industry "should keep a tight watch on the safeguard provisions of the law."

He said vigilance would ensure that safeguards set by the law "will benefit the farmers and the industry, which will bear the brunt of the influx of imported rice."

Pangilinan recalled the effects of the Tax Reform for Acceleration and Inclusion law which "promised additional revenues for the government to bring ease to the people's lives." Instead, "fuel price increases have pushed prices of commodities up, and brought extra cost to the farmers, who are now spending more for transportation cost." – Rappler.com