In response to escalating inflationary pressures, the Philippine government is contemplating a reduction in import duties on rice. This move comes just days after the announcement of a price ceiling for rice in the country.
The former head of the National Economic and Development Agency revealed on September 5 that the government is actively considering reviewing tariffs on rice imports. This measure aims to mitigate the impact of rising rice prices, which have placed a burden on low-income families.
Rice prices in the Philippines have experienced fluctuations over the past few months, largely due to extreme weather conditions. Meanwhile, India, the world’s leading rice exporter, has imposed restrictions on non-basmati white rice exports, prompting increased rice imports from Vietnam, the world’s third-largest rice exporter, to meet regional demand.
These considerations are rooted in the backdrop of the Philippines’ recent Consumer Price Index (CPI) report, which showed a sharp increase to 5.3% in August. This figure exceeds the Philippine government’s target inflation range of 2%-4% and marks the first uptick after six consecutive months of decline.
The surge in inflation can be primarily attributed to rising rice prices, which escalated to 8.7% in August from 4.2% in July. This was further exacerbated by reports of rice hoarding and escalating retail costs. Notably, rice accounts for approximately 9% of the Philippine CPI.
The Philippines has taken proactive measures to address the soaring rice prices, with President Ferdinand Marcos Jr.’s Communications Office confirming the approval of a proposal to implement a nationwide rice price ceiling through an Executive Order (EO) on September 1. The EO, which is now in effect, imposes price limits of 41 pesos per kilogram for white rice and 45 pesos per kilogram for well-milled rice.
As the Philippines grapples with inflation and its implications for citizens’ livelihoods, the government’s willingness to adjust import tariffs on rice underscores its commitment to mitigating the impact of inflation and ensuring access to essential goods for all. These developments will continue to shape the nation’s economic landscape in the months ahead.