STATEMENT
Secretary Arsenio M. Balisacan
National Economic and Development Authority
June 10, 2024
We are aware of the concerns raised by our farmers regarding the recent decision of the National Economic and Development Authority (NEDA) Board to reduce the tariff rate of rice. We understand the apprehensions and emotions that this decision has caused. As the Secretary of NEDA and Vice Chair of the NEDA Board, I want to assure the public that this decision was not made lightly.
The NEDA Board, composed of different Cabinet Members and chaired by the President, has unanimously approved the Committee on Tariff and Related Matters (CTRM) recommendation on the new Comprehensive Tariff Program for 2024-2028.
As a collegial body, the Board made this decision, recognizing its strategic importance in ensuring access and affordability to essential commodities—while balancing the interests of consumers, local producers, and the economy—which is crucial for fostering rapid, sustained, and inclusive economic growth.
The government is responsible for utilizing various instruments in its arsenal of policy tools to perform a delicate balancing act.
Before the NEDA Board approved the tariff recommendations of the CTRM, the Tariff Commission (TC) held extensive consultations and reviews under the Customs Modernization and Tariff Act (CMTA). As Section 1608 of the CMTA stipulated, the TC conducted public hearings on the comprehensive review to provide stakeholders with a reasonable opportunity to attend, present evidence, and voice their opinions. The consultation began as early as March 2023, and 801 stakeholders were invited, with at least 192 coming from the agriculture sector.
In the most recent comprehensive tariff review, the Tariff Commission received position papers and comments from 41 private sector parties, a consumer group, 15 Philippine government agencies, and a member of the House of Representatives. These inputs were invaluable in shaping the CTRM’s recommendations.
The goal of the NEDA Board in reducing the tariff rate of rice is to ensure that Filipinos have access to nutritious and affordable food, particularly rice, while managing inflation and sustaining our economic growth momentum. Based on the latest inflation report of the Philippine Statistics Authority in the past three months, rice contributed about two percentage points (or over 50 percent) to the headline inflation. Reducing rice tariffs is expected to bring down rice prices for consumers while supporting domestic production through tariff cover and increased budgetary support to improve agricultural productivity, especially as global rice prices remain elevated. At the same time, the government recognizes the pivotal role of the agriculture sector in our economy, and we are committed to its transformation through comprehensive strategies and reforms aimed at increasing productivity and farm incomes.
We understand the concerns of our farmers, and we are committed to supporting them through this transition. We are investing in infrastructure, promoting the adoption of modern technologies, improving market and financial access for local producers, and building resilience to climate change. Indeed, the Marcos Administration has prioritized agricultural development, as demonstrated by the increased allocation of resources to the sector. For example, the Department of Agriculture budget has increased by 69 percent from 2022 to 2024 compared to its average appropriation for 2017-2021.
We are also mindful of the need to manage inflation and ensure the affordability of essential staples for all Filipinos. High food prices disproportionately affect the poor and contribute to hunger, malnutrition, and stunting, hindering the attainment of our development goals.
In conclusion, we are committed to ensuring food security in the Philippines and strengthening the agricultural sector. We will continue to engage with all stakeholders, including our farmers, as we work towards these goals.
Thank you for your understanding and your continued support.
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