Photo: left DA Sec Manny Pinol, Right: NFA Admin Jason Aquino
As the 6.4% inflation rate has beaten expectations and forecasts, what is clear is that it is food and fuel prices have caused the inflation to rise.
Contrary to propaganda peddled by some people, we can no longer blame TRAIN or patricular government policies for inflation.
We already knew that fuel prices had been rising since June 2017, long before tax reforms came into effect. the 15 peso surge in fuel prices push food production and distribution costs up.
We also knew that our economy would continue to grow, and that unemployment would go down by the first quarter of 2018. The equation is simple enough: more jobs for more people= more money in pockets to buy more food=faster depletion of our food stocks= food prices rise.
Were our current food and agriculture officials now in the hot seat (picture above), caught unprepared by these two things that would cause food prices to soar? Despite the reported increase in palay production by 4.6% by about 200,000 metric tonnes early this year, spikes in prices happened in several areas like Zamboanga.
Instead of immediately filling these gaps, did they opt to do things the old way? Our country`s drive for rice self sufficiency is not a really bad thing in itsel. But is restricting the entry of cheaper imported rice a good thing for us?
We have known since 1995 is that our production cost for rice is two times more expensive than Vietnam`s. Yet since then, we stubbornly insisted on restricting imports by maintaining the National Food Authority (NFA) monopoly on it.
Our 2013 policy on Food Staples Sufficiency tried but failed to achieve this truly unachievable goal. Prices of food remained high, so much so that one in four Filipinos failed to eat enough well into the end of the PNOy years. (SWS, 2017).
Despite this, agriculture officials reportedly proposed to extend this right to limit imports until next year. (RMBriones, Galang,
and Tolin, PIDS Policy Notes March 2017).
These old policies have kept our rice prices high, even more expensive than our ASEAN neighbors. Even the 2 million rice farmers have difficulty buying the rice they grow.
Policy shifts have however, been strongly proposed, with new and better ideas to replace the old ones we have hung on to. The widely shared statement of our economic managers Sept. 5 (http://www.resurgent.ph/articles.aspx?id=515) point to reforms in the way we plant and get our food. Long proposed measures such as rice tarrification can make our farms competitive while lowering food prices.Its time we take these proposals seriously.
With our demand for food going up, perhaps it is time for a more rational food policy, will enable us to eventually produce sufficient our own food more cheaply, and make our farms competitive while giving us the flexibility to import what we need- all with the goal of lowering food prices for everyone, including our farmers.
Yes, while it may be easier said, it can be done.Its time we started doing it.
Briones, et al. (2017)(https://think-asia.org/handle/11540/6849)
Social Weather Stations (2017)https://www.sws.org.ph/swsmain/artcldisppage/?artcsyscode=ART-20170124102017