THE NATIONAL Economic and Development Authority (NEDA) Board, chaired by President Ferdinand R. Marcos, Jr., has approved another one-year extension of the lower tariff rates on rice, pork, and corn as the country continues to battle inflation.
NEDA Secretary Arsenio M. Balisacan on Thursday said the NEDA Board approved the proposed executive order (EO) to extend the reduced most favored nation tariff rates on several commodities, including rice, pork, and corn until Dec. 31, 2024.
A copy of the new EO, which will be signed by Mr. Marcos, has yet to be released as of press time.
Originally approved in 2021 by then-President Rodrigo R. Duterte, the modified rates for these commodities have been extended twice. The current order, EO 10, is set to expire on Dec. 31, 2023.
“The proposed extension of reduced tariffs will help ensure an adequate supply of agricultural commodities and maintain stable and affordable prices, thereby better managing potential inflationary pressures,” Mr. Balisacan said during a Palace briefing.
Once signed, the EO will maintain tariff rates for imports of swine meat or pork at 15% for shipments within the minimum access volume (MAV) quota and 25% for those exceeding the quota.
The tariff rates for corn will be kept at 5% (within the MAV quota) and 15% (exceeding the MAV quota).
Tariff rates for imports of rice will remain at 35% for both in-quota and out-quota.
“The tariffs while reduced are still high so it doesn’t really reduce the protection on our farmers,” the NEDA chief said.
Mr. Balisacan said the lower tariff rates on pork, corn, and rice will be reviewed every six months.
Inflation averaged 6.2% in the January-to-November period amid rising prices of food and fuel. The BSP expects inflation to average 6% this year and 3.7% in 2024.
Rice prices have been volatile this year. In September, rice inflation surged to 17.9%, the highest print since March 2009, prompting the government to impose a price ceiling for one month.
“We will also be able to encourage alternative supply to diversify the country’s market sources and establish a forward-looking trade policy that will allow effective and timely response for possible supply and price shocks brought about by major challenges such as the worsening African Swine Fever, anticipated impact of the El Niño phenomenon and continuous increases in commodity prices in the world market,” Mr. Balisacan said.
He said the NEDA Board also approved the Committee on Tariff and Related Matters’ recommendation to review the tariff rate on coal on an annual basis, instead of every six months.
EO 10 had stated that the zero duty on coal would be applied beyond Dec. 31, 2023.
“Extending reduced tariff will further discourage production which goes against the promise and objective of President Marcos,” Philippine Chamber of Agriculture and Food, Inc. President Danilo V. Fausto said in a Viber message.
The Federation of Free Farmers opposed the extension of the reduced tariffs, saying Mr. Marcos had been poorly advised.
“With respect to rice, (Mr. Marcos) was given the wrong information and advice,” FFF National Director Raul Q. Monetamayor said in a Viber message.
Leonardo A. Lanzona, who teaches economics at the Ateneo de Manila University, said lowering tariffs are ideal in general since it provides greater quantities and variety of goods to consumers.
“The main problem however are the negative impacts on producers of pork, corn, and rice,” he said via Messenger chat. “The government should have a countervailing program for producers to mitigate these negative effects.”
Mr. Lanzona said reducing tariffs for coal will be “disastrous” due to its negative impact on the environment. He urged the government to raise the tariff rates for coal and to look for other sources of energy.
MORE PROJECTSAt the same briefing, Mr. Balisacan said the NEDA Board also approved the Department of Public Works and Highways’ construction of a 23-kilometer, four-lane alternative route to bypass the existing Dalton Pass in Central Luzon.
“With a cost of P67.4 billion and an expected completion by 2031, the project will facilitate the seamless transport of people in the delivery of essential goods and services within the region,” he said.
The NEDA Board also approved the second phase of the DPWH’s masterplan, which aims to provide “high standard highway network.” The masterplan had identified 53 projects that will be implemented in the short term or will be completed by 2030.
Mr. Balisacan said the NEDA Board has also approved the Health department’s eight-point action agenda or medium-term strategy for the health sector from 2023 to 2028. — Kyle Aristophere T. Atienza