The Philippines, one of the world’s top rice buyers, should cut tariffs on imports of the grain for only a year at most instead of up to 2028 to limit the impact on farmers, according to Agriculture Secretary Francisco Tiu Laurel.
“I believe a short-term reduction in tariff to 15% is good enough...Maybe for only six months to one year,” Laurel told reporters on Wednesday. He said he’ll discuss his proposal with the rest of President Ferdinand Marcos Jr.’s Cabinet.
The Cabinet official’s stance on the timing of the tariff cuts differs from the National Economic and Development Authority board’s decision to reduce the import duty on rice to 15% from 35% until 2028. The board’s move was meant to tame inflation, which was fanned by recent double-digit gains in rice prices.
Global rice prices may drop once top exporter India eases export curbs, and by then the Philippine government could raise import tariffs again, Laurel said.
Manila may import more rice than the 3.6 million tons it had forecast for this year due to lower tariffs, Agriculture Assistant Secretary Arnel de Mesa said on Tuesday.
Lowering import tariffs — which has yet to be formalized in an executive order — is the latest plan by Marcos’s government to rein in rice prices. He imposed a month-long cap on domestic rice prices last year when he was agriculture chief amid reports of hoarding by traders. Laurel took over the post in November.
The International Monetary Fund said earlier this month that the plan to lower rice import duties could help food inflation ease faster later this year, and give room for the central bank to pivot to monetary policy easing. This view is shared by Monetary Board member Benjamin Diokno, who sees multiple rate cuts in 2024.
