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 Liberalization blamed for flood of rice imports

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ginebraghurl



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PostSubject: Liberalization blamed for flood of rice imports   Sat Jul 31, 2010 12:35 pm

Militant farmers and consumers slammed on Friday trade liberalization as the culprit behind the flood of rice imports that now rot in government warehouses. The farmers and consumers belonging to Bantay Bigas picketed the National Food Authority (NFA) office on Visayas Avenue in Quezon City to express their sentiments over the rotting rice. Bantay Bigas Spokeswoman Lita Mariano said the imposition by the World Trade Organization (WTO) that the country import between one and four percent of its rice consumption started the binge of overseas purchases in 1995. "Since 1995, the country imported many times over what was required due to its commitment to WTO," Mariano explained. "Our annual rice production deficit since 2008 was only between 10 percent and 15 percent or between 1.6 million metric tons (MMT) and 1.9 MMT but for 2010, the government scheduled to buy 2.45 MMT. So we are really over importing," she noted. With the country's accession to the General Agreement on Tariffs and Trade-WTO, the country was forced to import rice by at least one percent of its domestic consumption until 1999. This was to increase to two percent by 2000 and to 4 percent by 2004 as part of the minimum access volume (MAV) requirement under the GATT-WTO. The 4 percent MAV was extended for another 10 years starting in 2005, when the Philippine government negotiated for another extension. However, according to IBON Foundation research, since 1995 the country imported an annual average of 12.5 percent of the country's total rice consumption - the highest being in 1998 at 28.5 percent and in 2008 at 18.4 percent. Since 2000, the country has had an annual oversupply of 2 MMT. Cathy Estavillo, secretary general of the National Federation of Peasant Women (AMIHAN) - a member of Bantay Bigas, said: "The big traders are primarily the ones benefiting from this over importation of rice. They are given a yearly allocation to import 200,000 MT of rice and, in some instances these imports were made under the government's Tax Exemption Subsidy (TES). The rice is subsequently sold to the market at a price much higher than the prevailing NFA price which was between P18 per kilo and P25 per kilo." NFA sells the surplus rice to these traders at prices lower than purchased price under the Sale through Market Determined Price (SMDP), she noted. Mariano lamented that the poor are not benefiting from cheap NFA rice. Policy call But the previous administration has a different view of the rice situation. Elena Bautista-Horn, former President Gloria Macapagal-Arroyo's spokeswoman, said on Friday the importation of rice was a "policy call" of the previous administration, maintaining that there was no over-importation of rice in the previous years. Horn said the Inter-Agency Committee on Rice and Corn has recommended the importation of rice as a "policy call" to ensure that Filipinos have adequate supply of rice. The inter-agency committee recommends how much rice should be imported each year, and is composed of representatives of the National Food Authority (NFA), the Department of Trade and Industry (DTI), the National Economic Development Authority (NEDA), and the Department of Finance (DoF). "If the imported rice were excessive or lacking, perhaps we should give them a little space because it was also a policy call. If you recall in 2007 and 2008, we had a world food crisis. The other countries did not know where to buy rice, and there were long queues for rice," Horn said. Horn said the NFA should check the inventory of rice in its granaries because some of the rice stocks were for programs that were present in the Arroyo administration but have been scrapped by the new Aquino administration. She said the rice intended for the food-for-school program, in which schoolchildren receive one kilo of rice each for every day that they attend school, may have been factored into the NFA's assessment that there was a glut of rice in its granaries. The food-for-work program, which gives rice instead of salaries to street sweepers for their work, also needs several metric tons of rice to serve as payment to the street sweepers. Both the food-for-school program and the food-for-work program have been scrapped by the Aquino administration. (With a report from David Cagahastian)
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