The Philippines should negotiate for more beneficial tariffs for rice with the World Trade Organization instead of seeking to extend a protectionist policy that allows the National Food Authority to limit the volume of rice imported into the country, says a study by a government think tank. According to the Philippine Institute for Development Studies (PIDS) report written by economist Roehlano M. Briones, the country should negotiate for a tariff rate that offers equivalent protection to its producers, as well as a tariff reduction schedule that “would eventually improve rice affordability to consumers," rather than pushing for the extension of the quantitative restriction (QR) policy on rice imports. A clear advantage of tariffication, said the report, is that the government would still earn revenues by implementing a bidding procedure for allocating the quota. "The second advantage is that government no longer assumes planning function of computing the annual quota," it added. This would also avoid the "added uncertainty" of discretionary import targeting and eliminate a system that is "inherently prone" to rent-seeking and co-option of public institutions. The report acknowledged, however, that local farmers might not be favorable towards tariffication of imports, as lower tariffs would bring down the prices of imported rice and could result in an increase in imports to 3.5 million metric tons (MMT) from the projected 2.2 million MT.
