For probably the longest time running in its 46-year history, the National Food Authority is the hottest topic of the news, whether print, TV, radio or social media. Last week, practically all newspapers bannered the agency and the failure to stabilize the availability and affordability of its now single-commodity reason for existence: Rice.
It is always easy to point fingers at alleged culprits, and blaming each other among the high councils of government is par for the course. There are also the usual suspects–the middlemen, a.k.a. the cartels.
Just as it is always easy to create problems, and more difficult to arrive at proper solutions. In the case of rice, that species of grass scientifically named oryza sativa could be fatal.
So fatal that legislators, economists, and some in media are now calling for the abolition of the agency created on September 26, 1972 by Ferdinand E. Marcos, released on the fourth day after martial law was actually operationalized. It was then called the National Grains Agency, in charge of rice, corn, flour, and other staple food, since reduced to just rice.
In President Marcos’ hierarchy of national concerns, the country’s staple grain occupied premium attention. That primacy of concern has somehow abated, with the price of gasoline and diesel being deemed the more watched barometer of price changes since the Oil Price Stabilization Fund was mercifully abolished.
Marcos had a reason beyond economics: rice is politics. He won over reelectionist President Diosdado Macapagal in 1965 chiefly on the issue of the higher price of rice. Just as Macapagal hit predecessor Carlos P. Garcia’s inability to stop the price of a ganta of rice, then the measurement of volume rather than weight.
Of more recent memory, rice became scarce after the 1995 mid-term elections. Still reeling from the Flor Contemplacion execution, President Fidel V. Ramos was confronted by a scarcity brought about by the inability of NFA to import rice to augment dwindling stocks because the NFA Council chaired by the agriculture secretary did not want an importation due to a “self-sufficiency” goal and the imports becoming an election issue.
Both Agriculture Secretary Bobot Sebastian and NFA Administrator Romeo David resigned, and Ramos forthwith replaced them with then Rep. Salvador Escudero and DA USec Joemari Gerochi.
Then, in 2008, DA Sec. Arthur Yap and his NFA Administrator Jessup Navarro had to grapple with a rice price crisis, where people lined up for dwindling rations, and the price of rice hit the ceiling. So high that it triggered a world price crisis, with the Philippines becoming the world’s largest rice importer, Massive importation with the help of Vietnam stanched the 2008 shortage. But in 2009 and 2010, the massive importations continued, resulting in a P178-billion debt accumulation that President Benigno Aquino III in his first State of the Nation Address slammed along with warehouses packed even beyond the rafters of NFA’s owned and newly rented bodegas.
That massive debt was halted by our policy of shifting the task of importation gradually to the private sector in the two years that this writer was at NFA’s helm. The P178 billion was trimmed to P143 billion but succeeding government importations brought it up to almost P170 billion when President Duterte took over in 2016.
In 2014, under the watch of DA Sec. Proceso Alcala and his NFA appointee Orlan Calayag, prices of rice again spiked to 50-peso levels. An irate PNoy removed NFA from DA, along with the Philippine Coconut Authority, the National Irrigation Authority and the Fertilizer and Pesticide Authority, transferring these agencies to the Office of the President, and appointing now Sen. Francis Pangilinan as Food Security secretary. NFA still remains under the OP, with Cabinet Sec. Leoncio Evasco Jr. as chairman of the NFA Council, at least until mid-year 2018.
Now, in what insiders proclaim as their “worst crisis” ever, with stocks of NFA rice reaching a one-day national inventory sometime in June, the resonating call is for leadership to abolish the agency once and for all, especially since rice tarriffication to replace the QR is about a done deal.
One can understand, even empathize with Speaker Arroyo’s “neither being here or there” on the issue of the NFA abolition that several quarters demand. She understands the politics of rice, as much as she fully grasps the workings of the law of supply and demand. She saw how rice affected her father’s re-election, and how rice supply and prices bedeviled her in 2008.
Her loyalists in the HoR, Rep. Danilo Suarez and Joselito Atienza, are crying for the removal of DA Sec. Manny Pinol and NFA Administrator Jason Aquino for the mess we are in. Without them mentioning recent history, that was what happened in 1995 under FVR where both Sebastian and David unequivocally resigned.
At the heart of the conundrum is the expiration of our quantitative restrictions in June 2017. We are now the only WTO-affiliated economy still under a QR regime, which means we can restrict the amount of rice allowed to be imported into the Philippines, and that volume is determined by the NFA and the NFA Council where our economic managers preside.
In 1995 when we joined the World Trade Organization, we applied for, and were given a 10-year period to improve our palay farmer’s competitiveness, along with Taiwan and South Korea. But in 2004 when the QR expired, we were far from being competitive, and so we asked for another reprieve. Taiwan graduated, but South Korea joined us in asking for another extension, seven years, to end June 30, 2012. But PNoy believed Alcala’s boast that he could achieve self-sufficiency, and echoed this goal even before the world’s economic managers in Davos, who of course raised their eyebrows.
I was tasked along with DA Usec Fred Serrano and Asec Romy Recide to ask for a five-year reextension. Korea did not, and we were alone. The same was finally granted, with extreme reluctance and at great quid-pro-quo to our Minimum Access Volume not only in rice but in pork and poultry as well, only in late 2015, a five-year extension that expired last June 30, 2017.
Yet the conundrum still haunts our palay farmers sector vis-à-vis our humongous consuming population.
The plain and simple truth is, our farmers have remained uncompetitive. And our consumers are reeling from the impact of rice supply mismanagement that has created shortages and roof-high inflation in the staple.
To be or not to be NFA, that is the question.
To paraphrase a great leader: “The problem with those in government is that they talk too much, do so little, and act too late.”
Amen to that.