Cost Of Rice Expected To Drop By ₱7 Per Kilo
According to the estimates done by the country’s Finance Department, the prices of rice will be brought down by as much as ₱7 per kilo with the lifting of the quantitative restrictions (QR) on rice imports in favor of tariffs.
The Undersecretary of the Department of Finance, Gil Beltran said that a 35% import tariff on rice instead of restricting rice import volumes will encourage private traders to bring in rice into the country. This in turn will provide an influx of cheaper rice in the domestic market.
Philippines ranks fourth among other five Asian countries (Vietnam, Thailand, India, China, and Indonesia) in terms of rice production cost. Philippine’s average cost in producing rice is 10% higher than these five countries and 48% higher than the least cost producer.
The QR imposes a tariff on rice imports that reaches beyond the designated volume, imposing higher tariffs on the traders. If the QR gets lifted, the rice cost will go down and it will be less burdening on the average Filipino’s budget. Reducing the cost of rice is crucial in poverty reduction as it is a major driver of inflation in the country, according to Beltran.
The DOF official said the tariffication would generate P27.3 billion, which the government can use to augment funding for social protection projects like cash transfers for the poorest families as well as for palay productivity programs.