Press Release
February 14, 2018

Rice policy should not bloat P172 B NFA liabilities

As it grapples with ways to satisfy the "unli-rice needs" of 106.5 million Filipinos, the government should see to it that the solution should not further bloat the P172 billion liabilities of the National Food Authority, Senate President Pro Tempore Ralph Recto said today.

"The debt needle of the NFA should not move upward," Recto said, noting that a large chunk of NFA's debt could have been used to boost local production instead of subsidizing foreign rice growers.

"We should resist any notion, especially the one couched in populist terms, that we use borrowed money in buying rice from abroad," Recto said.

Recto said the audited financial report of the NFA for 2016 shows an agency deep in red.

"It had non-current domestic loans of P82.1 billion and P2.2 billion in interests payable. And P13.9 billion in maturing debts," Recto said.

"Sa notes payable in 2016, P21 billion was owed to the Development Bank of the Philippines, and P15 billion to the Land Bank of the Philippines," Recto said.

Recto said "rice security" can be achieved in the long run by boosting production, "by investing in irrigation and in cutting post-harvest losses, which wastes 17 percent of palay harvest."

Absent or poor post-harvest facilities spoil 2.5 million metric tons of rice a year --enough to meet the annual rice needs of 14 million people, or more than the population of Metro Manila, Recto said.

"If, for example, we have P5 billion, we can use it to buy palay or increase by 40 times the government's current budget for post-harvest facilities," he said.

"'Yung P5 billion na pambili ng palay, kasya lang sa anim na araw na rice supply ng ating bansa," he said.

But Recto said NFA should continue maintaining a buffer stock of rice, "because national interest requires us to have this reserve, but in a manner that is fiscally responsible and financially sustainable."

"Imports should pay duties, and should have an arrival time that will not compete with local palay harvest, and must not dampen palay gate prices," he said.

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