[STATEMENT] RICE TARIFFICATION LAW MUST BE REPEALED!
Kilusang Maralita sa Kanayunan (KILOSKA) will persist in its stance and demand the Lawmakers to REPEAL/REVOKE THE LAW ON RICE TARIFFICATION (RTL or RA 11203 of 2019). This legislative move was purportedly aimed at liberalizing the rice industry, promoting competition, and ensuring food security. However, RTL has not only failed but also actively made everything worse by ensuring more problems, particularly cartelization and farmer exploitation. In addition, the recent amendment of giving back authority to the National Food Authority (NFA) to purchase rice from farmers directly is seen as one more mechanism for strengthening cartels in agriculture which keeps perpetuating farmers’ exploitation. Furthermore, extending the RCEF (Rice Competitiveness Enhancement Fund) until 2030 is perceived as a potential catalyst for corruption. Moreover, the government intends to reduce the tariffs on imported rice from 35% to 15% until the year 2028.
The implementation of the RTL allowed unlimited importation of rice with a significantly reduced tariff from countries such as Vietnam and Thailand, which flooded the market with cheap imported rice thus reducing local produce prices and impoverishing countless Filipino rice farmers.
Moreover, allegedly foolproof measures contained within RTL like Rice Competitiveness Enhancement Fund (RCEF) did not prove adequate in mitigating. Although RCEF was meant to support local farmers through mechanization, seed distribution and training programs, its impact has been overshadowed by market dominance of cartels. Instead of empowering farmers, RCEF has been reduced to a mere tokenism gesture that cannot address the adverse effects of cartelization on the lives of Filipino farmers.
Between 2019 and 2022, rice imports surged from 2 million tons to an all-time high of 3.85 million tons, resulting in significant drops in local palay prices. This, coupled with declining farmer incomes by ₱ 4,500 per hectare per season, disincentivized farmers, especially as fertilizer and fuel costs increased. Despite a slight improvement in rice output, it failed to match population growth, leading to a decrease in our self-sufficiency ratio from 90% to 79%. Consequently, we became more reliant on foreign suppliers, with rice imports comprising 19% of our total annual supply during the RTL period, compared to 14% before. Contrary to promises, consumers did not benefit from lower rice prices, with studies showing minimal net savings of ₱52 per person per year. Instead, importers and cartels/traders profited from cheaper imports, leading to the RTL being dubbed the “Rice Traders Liberalization Law”. [1]
Reducing the price tariffs on imported rice from 35% to 15% will likely lead to an increase in rice imports from other countries. History has shown that such reductions often have negative repercussions for local farmers, rendering them less competitive and causing hardship for consumers who rely on affordable rice. Furthermore, this measure not only adversely affects farmers but also deprives the government of potential revenue. The concern lies in the possibility that cutting tariffs could prompt foreign rice suppliers to raise their prices even higher. Reduced tariffs primarily benefit a small group of large importers and traders, exacerbating the challenges faced by struggling farmers.
The recent amendment that bestows the NFA with the power to directly procure rice from farmers serves as a clear indication of the pro-cartel tendencies embedded within the RTL. While initially appearing as a favorable step towards government support for local farmers and price stabilization, in truth, this action thinly veils an effort to reinforce cartel dominance in the rice market.
The National Food Authority, despite being tasked with safeguarding the interests of Filipino farmers and consumers, has a history of corruption and inefficiency. In the past, there have been numerous reports of NFA officials colluding with cartels to sell off the agency's rice reserves at below-market prices, depriving farmers of a fair income and exacerbating the problem of rice smuggling. Through the act of authorizing the NFA to directly procure rice from farmers, the government is essentially sanctioning and prolonging this pattern of corruption, thereby solidifying the dominance of cartels/traders at the detriment of Filipino farmers.
In light of these concerns, it is clear that the RTL is not only a pro-cartel move but also an anti-farmer empowerment law. Rather than promoting competition and ensuring food security, the law has facilitated the monopolization of the rice market by powerful cartels, while simultaneously disempowering Filipino farmers and exacerbating poverty and inequality in rural communities. Embracing agroecology emerges as a transformative solution, offering both sustainable agricultural practices and ecological conservation. Agroecology, rooted in the principles of ecological balance and biodiversity, promotes farming methods that prioritize harmony with nature over reliance on chemical inputs and monoculture.
Given these glaring realities, it is crucial for the lawmakers to make a firm decision and revoke Rice Tariffication Law. RTL has proven to be a disastrous policy that has only served to aggravate the problems faced by Filipino farmers and entrench the dominance of cartels in the rice market. Its repeal is not only necessary but imperative if we are to uphold the principles of fairness, equity, and justice in our society. We call for the investigation of these cartels that are causing harm to our local rice farmers and industry. We urge the lawmakers to take bold and decisive action to chart a new course towards a more equitable and sustainable future for all!
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