The Federation of Filipino-Chinese Chambers of Commerce and Industry, Inc (FFCCCII) yesterday expressed support to proposals to eliminate tariff on rice or at least reduce it to 10 percent from the current 35 percent to address augment supply and further stabilize prices.
In a statement, FFCCCII president Cecilio Pedro said the proposal to temporarily remove or reduce tariffs would not only translate to a decrease in rice prices and temper the increasing inflation in food prices, but also address the demand-supply gap in this sector.
“This move will undeniably mitigate the pinch our countrymen are feeling due to the sharp increase in the price of rice, our staple food,” Pedro said.
But he said this temporary measure should be coupled with other calibrated measures to achieve long-term stabilization of the prices of rice and improve the inflation situation.
“We recognize the concerns of our farmers on the possible effects of the tariff reduction, such as the entry of cheaper imported rice and lowering of the prices of domestic palay. However, at this time of soaring prices and lack of supply of this staple, we need to consider foremost the needs of our consuming public … and support this temporary measure,” Pedro said.
In a separate statement, the British Chamber of Commerce Philippines also expressed support to proposals extending Executive Order No. 10 by conducting a review on the lower tariffs of commodities such as pork, rice, corn, and coal.
BCCP said the extension will address inflation and food security.
“The British Chamber remains committed to advocating for the lowering of tariffs which greatly helps in dealing with inflation and food insecurity. Also, it is necessary to help with the increasing global market demand and supply,” said Chris Nelson, BCCP executive director.
Meanwhile, the Federation of Free Farmers (FFF) yesterday said eliminating or cutting tariffs on rice is ill-timed since farmers are about to harvest the main season crop and rice prices will naturally go down.
“Encouraging additional imports through tariff reduction will further depress palay prices and discourage farmers from expanding their future production, thereby making the country even more dependent on imports,” Raul Montemayor, FFF national manager, said in a statement.
Montemayor said a tariff cut will not benefit poor consumers especially that 85 percent of imports are for premium grades of rice.
“The authority to adjust tariffs is constitutionally vested in Congress. This power can be delegated to the President only during extraordinary situations. The economic managers are abusing this privilege by waiting for Congress to recess on September 30, so that they can ask the President to cut rice tariffs through an executive order,” Montemayor said.
The United States Department of Agriculture’s (USDA) grains world trade report released yesterday said the Philippines may be delaying rice imports as traders are waiting for lower prices.
FFF concurred with USDA’s outlook, saying importers are on a wait-and-see because of uncertainties in government policy as well as movement in international prices.
The Tariff Commission is set to hear tomorrow, September 15 the petition of the Foundation for Economic Freedom to slash rice tariffs on rice.
