Birth or hunger pangs?

The Philippine agriculture has been left practically in a state of disaster when newly installed Department of Agriculture (DA) Secretary William Dar took over from his immediate predecessor, Emmanuel Piñol. While cleaning up the mess he inherited in the country’s agriculture sector, Dar is confronted with the consequences of the previous flawed management style.

Heading the DA for almost three years, Piñol’s simple farmer’s style of leadership turned out to be over-simplification of handling a major sector of the Philippine economy. Proof of which is the continuing decline in the rate of Philippine growth for the past three years now since President Rodrigo Duterte assumed office.

The Philippine economy grew by 6.1 percent in the last quarter of 2018. For the entire 2018, agriculture output grew by 0.56 percent.

At present, Dar is grappling with the resulting flood in the market of imported rice with the implementation of the Rice Tariffication Law (RTL) that took effect this year. It was at a time the economy was slowly recovering from the self-inflicted rice supply crisis that pushed the country’s inflation rate to almost six percent on annual basis. As it turned out, the rice crisis was the offshoot of the intramurals among the National Food Authority (NFA) Council that led to the shortage in supply of the Filipino staple food. This is not to mention the palay production losses across the country due to a series of typhoons that hit the country last year.

As the NFA Council wrangle over whether or not to import rice on government-to-government basis or just to leave it to the private sector, the rice stocks at the NFA warehouses were dwindling as the prices of rice soar to more than P35 per kilo in the markets. It took President Duterte to step into the row and ordered the NFA to fill all its warehouses with rice stocks all the way to the roof, if need be, just to calm down the public outrage from the rising prices of rice.

As one problem is solved, a new one emerges. Filipino rice farmers begin reeling from the resulting reduction of farm gate prices of palay now that there is more than enough supply of the staple in the markets as stocks of imported rice came in bulks.

While this is happening, the newly installed DA Secretary has to deal also with the evolving spread of the African Swine Fever (ASF) that now threatens the viability of the Philippine hog industry. It is estimated that commercial and backyard hog industry in our country produces P200 billion in annual sales revenues. The ASF is now a global pandemic that has seriously dislocated the livelihoods of hog raisers across the globe, mostly China which has already culled more than a million pigs to prevent the spread of the disease. However, the ASF has already spread to other countries from Asia to Europe.

From Piñol’s crude methods of footbaths at the airports to supposedly stop the entry and spread of the ASF to his wrangling with the economic managers of President Rodrigo Duterte, the Philippine agriculture suffered enough. And the tough job to ensure a steady, if not speedy, recovery of Philippine agriculture lies in the shoulders of Dar to save our country’s rice and hog production from oblivion.

The RTL was one of the administration bills that President Duterte certified to the previous 17th Congress. President Duterte signed on Feb. 14 this year Republic Act No. (RA) 11203, or “An Act liberalizing the importation, exportation, and trading of rice, lifting for the purpose the quantitative import restriction on rice.”

Among other things, the RTL also created the Rice Competitiveness Enhancement Fund (RCEF) for the procurement of rice farm equipment – such as tillers, tractors, seeders, threshers, rice planters, harvesters and irrigation pumps. A total of P10 billion annually is allocated under RTL to be taken from the tariff collections of the Bureau of Customs out of imported rice. Apparently, however, Piñol who staunchly opposed the RTL did not lift a finger to secure the release of these funds for the affected rice farmers.

Per official estimates, rice farming in the country employs some 2.5 million Filipinos. But if multiplied by an average size of family of five, there would be more than 12 million Filipinos out of our more than 100 million population whose living depends on rice farming.

Fast forward. The harvesting of palay in the country started already this month, according to Dar. “All the measures should be implemented. Roll over scheme, accelerate the selling of palay,” Dar announced a few weeks after his appointment as DA Secretary last Aug. 5.

The Senate committees on agriculture and food began their inquiry into the implementation of the RTL being blamed for the woes of the affected rice farmers. The latest reports have it that palay was being bought from farmers at P17 per kilo, or about the same price that the NFA offers. President Duterte has already issued a marching order to the NFA to buy the palay produce of rice farmers even at a loss to the government.

“We have to contend with the initial birth pangs [of the law] and these are what we are managing,” Dar told the House appropriations committee during his defense of the DA’s proposed P71.8-billion budget for 2020. According to Dar, the DA’s proposed budget for next year is a 12 percent increase from the agency’s budget this year. But this increase, he cited, was mainly due to the direct addition of RCEF to the DA budget.

Some 1.2 million metric tons of imported rice have already arrived in the country between February and August this year. The RTL imposed a 35-percent tariff on imported rice as one of the measures to help protect farmers from competitive pricing of rice imports. The government reported having collected P9.2 billion in tariff so far from rice imports.

Dar looks at the problems being attributed to the RTL as just “birth pangs” that can eventually go away. Unless the RCEF gets directly to the rice farmers, they are the ones to bear the hunger pangs.