Press Release
January 11, 2019

Koko: Rice tariffication law to benefit consumers, address NFA issues

Senator Aquilino "Koko" Pimentel III today said that the impending signing into law of the rice tariffication measure is expected to "stabilize rice prices, boost food security, and cure a decades-long rice procurement system ridden with inefficiency and corruption."

Both houses of Congress ratified the measure last November 2018. It is set to be transmitted to Malacañang for the signature of President Rodrigo Duterte.

The bill, which amends the twenty year-old Agricultural Tariffication Act of 1996, replaces the quantitative restriction (QR) on rice imports with a 35 percent tariff.

"This is a groundbreaking change from the old system where imports were subjected to regulations that are vulnerable to graft and to traders who want to engage in price manipulation," said the senator from Mindanao.

"Now, legitimate rice traders can import rice without need of any permit from the National Food Authority (NFA). They just need to secure import clearances from the Department of Agriculture's Bureau of Plant Industry and pay the appropriate tariff to the Bureau of Customs," added Pimentel.

According to the legislator, "by signing the tariffication measure into law, the President will allow market forces and fair competition to dictate the supply and pricing of rice. This ensures stable stocks year round all over the country and gives consumers greater freedom of choice."

The Mindanao-born legislator was also quick to point out that removing QR on rice importation and limiting the responsibilities of the National Food Authority (NFA) wiIl "focus" the priorities of the grains agency and address the agency's efficiency and corruption issues.

Pimentel explained that under the rice tariffication law, the NFA would be tasked mainly to ensure the sufficiency of buffer stocks for use in emergencies.

"The NFA retains its functions to buy palay from local farmers, but it will not be involved in importation. This should lead to a more focused and improved NFA, which will be tasked to work with the Agriculture department to develop cost-efficient systems that will boost domestic rice production and assist our struggling rice farmers."

The bill also provides for the establishment of the Rice Competitiveness Enhancement Fund (RCEF), which aims to use tariff revenues for productivity-enhancing programs for rice farmers.

These programs include the improvement of farm mechanization, development of high-yielding rice seed varieties and promotion of use, expanded rice credit, crop diversification, and extension services.

"In a country with a population of 104 million people that continues to grow, food security is a serious concern that requires decisive action and sweeping reforms to ensure that food staples like rice are available and affordable," Pimentel stressed.

"Properly implemented, the rice tariffication law should help secure these objectives. The onus is on the NFA and DA to make this work, and the President has shown that he will not hesitate to crack the whip to ensure that the Executive Department delivers."

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