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I. INTRODUCTION

Rice is the most important human food crop in the world, directly

feeding more people than any other crop. In 2012, nearly half of world’s

population – more than 3 billion people – relied on rice every day. It is also

the staple food across Asia where around half of the world’s poorest

people live and is becoming increasingly important in Africa and Latin

America.

Rice is the staple food for about 80% of Filipinos, which accounts for

46% and 35% of their caloric intake and protein consumption,

respectively. Rice is the single most important agricultural crop in

the Philippines, and is therefore a major source of income for millions of

Filipino farmers (Bordey, 2010).

Rice is not merely a food but a grain that shapes their way of living,

their hopes, and their dreams. We consider rice as a symbol of their quest

for life’s security and emancipation from hunger. Thus, achieving rice

security is intricately related to the nation’s struggle in eliminating extreme

hunger and poverty – the United Nation’s first Millennium Development

Goal. In fact, rice security is tantamount to food security in the Philippines.

As the staple food of the Filipinos, rice accounts for 46% and 35% of their

caloric intake and protein consumption (FAO 2008). As a major part of

food spending, rice comprised 16% of the total expenditures of the poorest

30% of the population (World Bank 2007). Thus, a rise in rice prices could

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significantly raise the Filipinos’ cost of living sending more people to

poverty.

The Philippines became self-sufficient in rice in the 1970s and was a

rice exporter to neighboring countries such as Indonesia, China, and

Myanmar. However, with the rapid increase in population and limited land

resources to produce the total rice requirement, the country slowly turned

into a net rice importer. The Philippines is the second largest rice importer

in the world next to China (Simeon, 2019). In 2017, the country imports

rice mainly from Vietnam (52%) and Thailand (29%) (Santiago, 2019).

Although the Philippines has relied increasingly on rice imports since

the 1990s, its quest for the rice self-sufficiency has persisted. In constant

debate, academicians, scientists, economists, and politicians argue for

and against attaining rice self-sufficiency. Some say that the Philippines’

lack of comparative advantage in producing rice can be attributed to its

geography (Dawe 2006). Others say that public investments required to

achieve rice self-sufficiency are too costly given the competing use of

scarce public resources. On the other hand, there are those who believe

that self-sufficiency is justified by the thin world rice market. Since rice is

mostly consumed in countries where it is produced, world supply is

vulnerable to changes in the consumption and production dynamics of

major producing countries. Thus, it is more practical to source rice from

domestic production to avoid severe fluctuations in the world supply of rice

and its price.

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 The Rice Tarrification Law essentially allows for the liberalization of rice

imports. It will remove the previously placed quota on rice imports,

permitting traders to import a near-unlimited quantity of rice.

I. OBJECTIVES

This study aims to answer,

1. The positive effects of Rice Tarrification Law to National Economy and

Labor of Filipino Farmers

2. The negative effects of Rice Tarrification Law to National Economy and

Labor of Filipino Farmers

3. The proper implementation of the law

II. LEGAL BASIS

ARTICLE XII

NATIONAL ECONOMY AND PATRIMONY

Section 1. a.) The goals of the national economy are a more equitable

distribution of opportunities, income, and wealth; a sustained increase in

the amount of goods and services produced by the nation for the benefit of

the people; and an expanding productivity as the key to raising the quality

of life for all, especially the underprivileged.

b.) The State shall promote industrialization and full employment based on

sound agricultural development and agrarian reform, through industries

that make full and efficient use of human and natural resources, and which

are competitive in both domestic and foreign markets. However, the State

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shall protect Filipino enterprises against unfair foreign competition and

trade practices.

c.) In the pursuit of these goals, all sectors of the economy and all regions

of the country shall be given optimum opportunity to develop. Private

enterprises, including corporations, cooperatives, and similar collective

organizations, shall be encouraged to broaden the base of their

ownership.

Section 9. a.) The Congress may establish an independent economic and

planning agency headed by the President, which shall, after consultations

with the appropriate public agencies, various private sectors, and local

government units, recommend to Congress, and implement continuing

integrated and coordinated programs and policies for national

development.

b.) Until the Congress provides otherwise, the National Economic and

Development Authority shall function as the independent planning agency

of the government.

Section 12. The State shall promote the preferential use of Filipino labor,

domestic materials and locally produced goods, and adopt measures that

help make them competitive.

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 ARTICLE XIII

LABOR

Section 3. a.) The State shall afford full protection to labor, local and

overseas, organized and unorganized, and promote full employment and

equality of employment opportunities for all.

b.) It shall guarantee the rights of all workers to self-organization, collective

bargaining and negotiations, and peaceful concerted activities, including

the right to strike in accordance with law. They shall be entitled to security

of tenure, humane conditions of work, and a living wage. They shall also

participate in policy and decision-making processes affecting their rights

and benefits as may be provided by law.

c.) The State shall promote the principle of shared responsibility between

workers and employers and the preferential use of voluntary modes in

settling disputes, including conciliation, and shall enforce their mutual

compliance therewith to foster industrial peace.

d.) The State shall regulate the relations between workers and employers,

recognizing the right of labor to its just share in the fruits of production and

the right of enterprises to reasonable returns to investments, and to

expansion and growth.

AGRARIAN AND NATURAL RESOURCES REFORM

Section 5. The State shall recognize the right of farmers, farmworkers,

and landowners, as well as cooperatives, and other independent farmers’

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 organizations to participate in the planning, organization, and management

of the program, and shall provide support to agriculture through

appropriate technology and research, and adequate financial, production,

marketing, and other support services.

IV. ISSUES

The Rice Tarrification was signed into a law by President Duterte on

February 15 earlier this year to address rice supply problems which have

contributed to higher rice prices for Filipinos. Now the lack of supply was

the main reason of inflation last year. Since October 2018, Duterte

declared the issue as “urgent” due to price hikes that caused rice to hit

P70 per kilo last year. Finance Assistant Secretary Tony Lambino predicts

that the law will cut rice prices by P7 per kilo. Bangko Sentral ng

Pilipinas projects that this will also cut inflation by 0.6 percent. The data

below shows the rise and lows of the rise inflation.

Source: ANC News

The rise inflation shown by the grey line peaking in September and

October, pushing overall inflation shown by the blue line to near ten year

highs. Government moves to import rise before the rice tarrification went

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into effect March 5 this year, tough start rice inflation on a downward

path. But as the data shows by the grey line, we see, after March, the rice

tarrification deepend the down trend with rice prices contracting after

April.

Source: ANC News

From March onward we see rice supplies stabilizing by the

National Food Authority as shown by the grey portions of bars above.

Source: ANC News

The data above coincides with the data aforementioned, with a decline

of agricultural output which contracted in the second quarter, its largest

contraction in nearly three years.

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 Source: ANC News

This data shows why the Filipino farmers are struggling, the volume of

domestic palay production only reached 8.3 million metric tons of palay

production lower than the same period of years 2017 and 2018.

V. DISCUSSION

Technically, with the existing rice tarrification law, Filipino farmers

must stick with the reform, noting that competition will make local rice

farmers more resilient. It will prevent price hikes in the future as

competition is a healthy component for the economy. Department of

Agriculture Secretary William Dar is moving to better implement the 10

billion peso Rice Competitativeness Enhancement Fund (RCEF)

financed by rice tarrifs. Senator Cynthia Villar has also been pushing for

proper spending of RCEF and that local farmers are still being protected

from foreign competition. In the long run, Rice Tarrification Law (RTL) is

beneficial to National Economy. As of August this year, rice stock

inventory increased by 40.3 percent due to higher importation of rice.

Due to higher importation of rice, the Philippines tops the current

biggest importer of rice, China. On September 2019, the two countries

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were tied at the top spot with a projection of 3.1 million metric tons of rice

imports. The country’s imports increased by 58 percent to 3 million MT

from 1.9 million MT last year, and by 275 percent against 2017 record.

From being second to China, the Philippines is now world’s biggest rice

importer, an agricultural country which imports rice. Local farmers are in

the worst condition based on the data statistics aforementioned. Kilusan

ng Magbubukid ng Pilipinas considers the law as a “death warrant” to the

local rice industry as it would open the floodgates to foreign industries

that would overpower or “wipe out” local rice farmers. KMP estimates

that 500,000 of a total of 2.4 million rice farmers will be negatively

impacted by the law. The organization states that only through investing

and boosting local production will the Philippines achieve stable rice

prices and supply.

The Department of Agriculture promised strict implementation of the

RTL, but despite the falling price of unmilled rice, the cost of grain

remains the same in public markets. The Philippine Trade Department

projected that the rice price will fall to 30-32 pesos a kilo because of the

rice tarrification law. Local vendors explained even if local unmilled rice

becomes cheap, their suppliers charge them almost just the same, that’s

why they have no choice but maintain the old market prices. Making our

local farmers in the worst condition due to improper implementation of

the Rice Tarrification Law.

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VI. RECOMMENDATION

Rice self-sufficiency is always a must, emphasizing the fact that we

are an agricultural country. The Rice Tarrification Law is good in the long

run but why must the government be unaware of the strict monitoring of

rice suppliers that sells rice on high price well in fact it [unmilled rice] was

bought in a disappointingly cheap price of P7 from local farmers.

I suggest the government must give the farmers funds to operate,

other than the 10 billion peso RCEF coming from the rice tariffs. It will

give them enough funds for capital in planting palays during the duration

of the Rice Tarrification Law reform.

VII. REFERRENCES

http://ricepedia.org/rice-as-a-crop

Article 12, 1987 Philippine Constitution

Article 13, 1987 Philippine Constitution

https://news.abs-cbn.com/business/09/03/19/dissecting-data-impact-of-rice-

tariffication-law-on-filipino-farmers

http://fnbreport.ph/features/agriculture/the-rice-tariffication-law-explained-

anrii-20190221/

http://www.neda.gov.ph/rice-tariffication-law-proves-it-is-beneficial-neda/

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