Philippines Finance Ministry to Lower Tariffs on Imported Rice to Counter Inflation

According to its secretary, the Philippines' finance ministry has recommended a series of measures, including lowering tariffs on imported rice, to curb rising retail prices that are fueling inflation.

As per Finance Secretary Benjamin Diokno, the ministries of finance and economic planning are proposing a reduction in the 35% rice import tariff rates to between 0% and 10%.

Tariffs on rice imported from outside Southeast Asia were reduced from 40-50 percent to 35 percent under a modified scheme implemented in 2021, matching the rate for suppliers from within the region, including Vietnam.

The ministries are also encouraging timely imports of rice by the private sector and fast tracking shipment clearance for qualified importers, Diokno said.

In August, the Philippines' farm ministry recommended an additional 500,000 metric tonnes (MT) of rice imports for arrival between November and January of next year to cover potential crop losses from El Nino, a naturally occurring weather pattern that is expected to bring dry weather conditions.

To protect consumers, the Philippines, one of the world's largest rice importers, imposed price ceilings on rice last week.

Rice inflation in the Philippines reached 4.2 percent in July, the highest level since 2019. In August, the country's inflation rate unexpectedly increased to 5.3 percent for the first time in seven months, owing primarily to an increase in food and transportation costs.

Prices of both milled and unmilled rice will stabilise as farmers start to harvest their main season crop this September and October, the presidential office said on Sept 10.