Wednesday, November 14, 2018

Agri Econ 27, On rice tariffication and trade liberalization

Last Monday on my way to a meeting in Solaire Hotel, I passed by a group of rallyists going to the Senate. Mostly NFA employees, they oppose rice tariffication (conversion of quantitative restrictions, QRs into tariff), oppose removing NFA importation monopoly, in short they demand more rice protectionism, 

SB 1998 or the rice tariffication bill intends to amend RA 8178, Agricultural Tariffication Act, implement a 35% duty or tariff on imported rice from the ASEAN, 50% tariff for rice imports from non-ASEAN countries. It will also remove NFA authority to monopolize or regulate the importation of rice and issue import licenses for the private sector.

This illustration I got from the web, perhaps DOF made this.



Senate committee on agriculture Chair is Sen. Cynthia A. Villar. SB 1998 will also create the Rice Competitiveness Enhancement Fund, P10 billion initial appropriation, succeeding years funding will come from the tariff revenues for rice importation, about P8 B/year.


On plans that government should subsidize high value crops for small rice farmers, I think a better option is for government to remove oil taxes. PH agri is becoming more mechanized. From hand tractors to bigger tractors, from manual to machine harvesters. Higher oil taxes means higher cost of farming.
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