MANILA, Philippines - The Department of Agriculture (DA) is set to start crucial talks with Thailand and Vietnam regarding possible government-to-government rice purchase deals this month.
This was confirmed by Agriculture Secretary Arthur C. Yap following a DA-Philippine Stock Exchange signing on the study of an agricultural commodities exchange.
Yap refused to communicate the Philippines’ possible position on offers from the two countries.
Yap also refused to give a straight-forward answer to questions that the DA, through the National Food Authority (NFA), is actually setting the stage for the government-to-government rice deals even though it has set a rice tender for Wednesday, Nov. 4.
Rice industry sources claim that the NFA has set additional terms for the prospective bidders such as extending a longer credit term for the payment of the rice shipment.
Seeking longer credit terms, rice industry sources said, could result in a failed bidding which would safely allow the government to enter into another government-to-government rice deal similar to the one it secured from Vietnam last year for 1.5 million metric tons of rice.
That deal was criticized for its lack of transparency and there were even insinuations that the price paid by the Philippines was higher than the prevailing market rate.
An NFA insider, however, defended such a possible term, pointing out that the Government should try all options which would ensure the best terms for the government.
“Who knows, there might be a bidder willing to extend longer credit terms, the Government does not know until it does it,” sources said.
Thai government representatives are set to come to the Philippines for further negotiations on rice tariff differences under the soon to be implemented ASEAN Free Trade Arrangement-Common Effective Preferential Tariff (AFTA_CEPT) scheme.
Likewise, Vietnamese officials had earlier announced the start of possible government-to-government negotiations on another rice deal following the Nov. 4 rice tender.
The Philippines has a Memorandum of Understanding with Vietnam for the supply of rice.
The MOU was signed last year at the height of the rice crisis.
That agreement with Vietnam reportedly ticked off Thailand which is also a net importer of rice and considers its rice to be more superior than Vietnam.
Trade negotiators had explained to The STAR, that Thailand wants the Philippines to secure the bulk of its rice requirement from the Philippines.
The Philippines is the world’s biggest importer of rice.
The Philippines has once again decided to start importations of its possible rice requirements for next year following the unexpected destruction of rice crops by a series of recent typhoons that hit the country in the latter part of the third quarter.