MANILA, Philippines?Fresh off her plane from Hong Kong Tuesday night, President Gloria Macapagal-Arroyo called her Cabinet to a rare meeting at the Ninoy Aquino International Airport to announce she was issuing an executive order authorizing the use of P5 billion?5 percent of last year?s budget surplus amounting to P100 billion?to subsidize the nation?s farmers and ensure a steady supply of rice for Filipinos.
This reportedly would be the biggest ever subsidy to food producers in the country.
The President also said the local government units (LGUs) could tap into P32 billion of the budgetary surplus to fund rice production.
Since the Local Government Code devolved supervision of the Department of Agriculture to the local governments, she said the LGUs could tap into the budget surplus even without seeking additional funding from Malacañang.
The President met with the Cabinet and members of the board of the National Economic and Development Authority (NEDA) at 8 p.m. at the NAIA Presidential Lounge on her arrival from Hong Kong where she keynoted the 11th Asian Investment Conference.
Present were Vice President Noli de Castro, Executive Secretary Eduardo Ermita, Secretaries Raul Gonzalez (justice), Arthur Yap (agriculture), Peter Favila (trade and industry), Gilbert Teodoro (defense), Ace Durano (tourism), Lito Atienza (environment), Hermogenes Ebdane (public works), Angelo Reyes (energy), Ignacio Bunye (press), Cerge Remonde (Presidential Management Staff), Cabinet Secretary Ricardo Saludo, NEDA Director General Augusto Santos and Armed Forces Chief of Staff Gen. Hermogenes Esperon. Deputy presidential spokespersons Anthony Golez and Lorelei Fajardo were also there.
In her opening statement at the meeting, Ms Arroyo said she ?will issue an administrative order allowing corporations and institutions of government to use 5 percent of their surplus amounting to P100 billion for planting rice and other anti-poverty programs in accordance with the law.?
She ordered the government agencies to consult with the DA and the Department of Social Welfare and Development on the formulation of the rice-planting and anti-poverty programs.
?I am ordering the DA to craft a program that will allow the LGU to plant palay and sell the produce to the NFA (National Food Authority),? the President said, pointing out that LGUs had available lands that could be converted to rice fields.
?We look forward to key allies among LGU leaders and top government (corporations and financial institutions, among others) to immediately and prominently respond to this call. We invite them to present their initial plans to the Cabinet on April 8, and begin implementation within three months,? she said.
The President also ordered the agriculture, trade and justice departments to:
? Cancel the licenses of 400 accredited markets in Metro Manila out of the 15,000 around the country.
? Monitor rice warehouses and public markets.
? Spur an increase in the rice harvest.
? Ensure the steady supply of more affordable NFA (National Food Authority) rice in poorer barangays (villages) and to inform neighborhoods of cheaper rice sources.
? To provide 200 military trucks to augment the 1,400 NFA trucks that will sell rice around Metro Manila.
Standing throughout her 10-minute speech to the Cabinet, Ms Arroyo also reported on the successes of her Hong Kong trip, including a $2-billion investment in Fort Bonifacio and a proposal from the world-renowned Shangri-La group to build a six-star hotel there.
Buzz at airport
The NAIA Centennial Terminal was abuzz at least two hours before Ms Arroyo and her entourage of government officials arrived on a commercial Philippine Airlines flight.
Airport workers and Palace staff turned one side of the arrival area into an assembly area for members of the media and resource persons who were called to the evening Cabinet meeting.
Barong-clad members of the Presidential Security Group and airport police in gray scoured the terminal and secured the President?s pathway. A buffet table was set up in the Presidential Lounge.
The President said the Department of Justice would soon file charges against unscrupulous rice traders caught selling NFA rice at high prices.
No to tariff cuts
She also commended Antonio Villar, chief of the Presidential Anti-Smuggling Group, for conducting a raid on a rice warehouse in Bulacan province earlier in the day.
Earlier, in Hong Kong, Ms Arroyo thumbed down a World Bank proposal to reduce the tariff on Philippine rice imports, saying this was ?not practical.?
She went on a three-day visit to the former British Crown Colony, which has been gripped by panic buying of rice that emptied the shelves of some supermarkets.
Ms Arroyo acknowledged that the whole world, including the Philippines, was vulnerable because of the tight supply of rice.
What the country needs is ?rice security,? and ?not necessarily self-sufficiency,? Ms Arroyo said, explaining that this meant that the government should reduce its import dependence.
?Apparently, our competitive advantage is on other things and as long as we can earn enough to be able to afford the rice coming from elsewhere, that still makes good economics,? she said.
Thai premier?s Manila visit
Hours before flying home from Hong Kong, Ms Arroyo said she was set to discuss Manila?s possible rice importation from Thailand on Friday when she meets with Thai Prime Minister Samak Sundaravej, who is due for a state visit in the Philippines.
She said her request for the purchase of rice from Thailand had been made as early as December last year when she went to Bangkok and spoke to officials there.
?They said that they were willing to supply us... the prime minister of Thailand will come on Friday to the Philippines. We will follow it up with him,? Ms Arroyo said.
Lean season starts June
But she underscored it was important that the rice to be imported from Thailand should come in by June ?when the lean season happens.?
?So if Thailand can assure that it can deliver by June, we will order from Thailand,? the President said.
Just the same, she said officials were making sure that the 600,000 metric tons (MT) of the 1.5 million MT of rice recently ordered from Vietnam would also be delivered by June.
Ms Arroyo said it was a good thing that the Philippines was able to sign last week the 1.5-million MT rice purchase agreement with Vietnam because Hanoi recently announced a 30-percent reduction in its rice exports.
She said the rice to be delivered by Vietnam and whatever could be purchased from Thailand would be able to ?cover our needs.?
Curbs on imports
But Vietnam indicated it may not be able to supply the 1.5 million MT because it was facing production difficulties.
Aside from Vietnam, India, Egypt and Cambodia have imposed limits on exports to encourage dealers to sell to their respective domestic markets.
The restrictions were believed to have removed a third of the rice traded in the international market.
Scrap AFMA
Rice imports have consistently increased since the Agriculture and Fisheries Modernization Act (AFMA) was signed into law in 1997, according to the research group Ibon Foundation.
From 722,000 tons in 1997, rice imports reached 1.7 million tons in 2006. For 2008 the country is expected to import some 2 million tons of rice, Ibon said Tuesday in a statement.
It urged the Arroyo administration to discontinue policies like AFMA, which it said contributed to the country?s current rice crisis.
Fee to the NFA
An option the country?s economic managers are considering is an increase in the subsidy given to the NFA to allow the state agency to shoulder some of the import costs of private importers.
Agriculture Secretary Yap said the scheme would call for the NFA to import rice ?through a tax-expenditure-subsidy scheme and the volume that NFA brings can be sold to the private sector for it to distribute on the basis of an equalization fee that they will bid for.?
Under this plan, the private sector will be allowed initially to bring in 163,000 tons of rice this year, with each importer given a maximum volume of 2,500 tons. With reports from Amy R. Remo and TJ Burgonio; Reuters and Agence France-Presse
