Why is there a rice crisis in the Philippines?

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Metro Manila (CNN Philippines) — Ordinary Filipinos have had to scrimp on their meager budgets for the past eight months as prices of goods and services surged to a nine-year-high at 6.4 percent in August.

Prices of consumer goods have risen consecutively from 3.4 percent in January.

That's why economic managers have come up with measures to flood the market with rice, a main driver of inflation. They want to lift rice import limits and allow the private sector to bring more of the staple subject to a 35 percent tariff.

This means, the country can now boost imports of rice stocks, instead of restricting shipments based on minimum access volume.

But how does an agricultural country like the Philippines end up relying more on rice imports to meet demand?

According to the World Bank, Philippine agriculture output has been on the decline over the years. Philippine data show the sector grew by an anemic 0.58 in January to June this year -- a big setback from the 5.73% growth recorded in the same period of 2017.

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Authorities admit local rice production alone can't feed more than 100 million Filipinos, so they resort to more imports from Vietnam and Thailand.

Government data show, the country had increasingly imported rice for the past 5 years.

This has contributed to more imports than exports, resulting in an agriculture trade deficit of $5.2 billion or ₱275.6 trillion as of 2017, from only $1.5 billion or ₱63.6 trillion 5 years ago.

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But importing more rice will happen at the expense of Filipino farmers. Imported rice is cheaper, so consumers would prefer it over local produce.

A government think tank said, local farmers will suffer a 29% income loss if the floodgates are opened to rice imports.

It doesn't help that the agricultural labor force has been on a drastic decline, losing over 1.5 million workers in the past five years alone. This means lower production as more farmers, fishermen, and workers look for other means of livelihood.

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Our rice-producing neighbors like Vietnam and Thailand, produce an average of 5-8 tons per hectare at ₱5 to ₱9 per kilogram. But, we only produce 3-6 tons at higher costs of ₱11 to ₱14 per kilogram, not to mention additional costs imposed by middlemen.

Experts have listed a number of proposals to improve agricultural output. These include improvement in research and development, quality infrastructure for farming, climate-resilient farming technology, and quality irrigation systems for higher yield, among others.

Filipinos are complaining about the lack of cheap rice, and the government responds with more imports. It's a stop-gap move to appease immediate consumer concerns. But authorities should make sure long-term measures are in place, to feed an ever-growing population at an affordable price.