The National Food Authority clearly failed to live up to its mandate. For that, its chief should be held accountable for surging rice prices and the spike in the overall inflation rate.
The late President Ferdinand Marcos created the NFA (then known as the National Grains Authority) on Sept. 26, 1972 as the agency responsible for ensuring the food security of the Philippines and the stability of supply and price of rice, the country’s staple grain. The NFA, in just two years of the Duterte administration, did the opposite.
Malacañang the other day blamed outgoing NFA administrator Jason Aquino for “singlehandedly” aggravating inflation with the rice crisis during his watch, which in turn led to the decline in President Rodrigo Duterte’s approval and trust ratings.
The NFA is tasked with managing the country’s rice inventory and stabilizing food prices, especially rice. It should have the feel of the market, know when to buy or import rice from other countries, and anticipate a surplus or a deficit in supply based on farm output from the preceding quarters and weather conditions.
The NFA and its chief executive obviously did not do their job. The NFA warehouses were virtually empty in recent months, resulting in the surge in rice prices. The agency was also slow to respond to the situation—it did not immediately issue a call for imports.
The shortage in rice supply was the main reason for the inflation rate surging to a nine-year high of 6.4 percent in August. Lower rice production and the decreased output of the overall agriculture sector, meanwhile, are making a dent on the economy.
The Asian Development Bank just downgraded its economic growth outlook for the Philippines this year and next amid the slower agricultural output, higher inflation and global monetary tightening.
The ADB now sees the Philippine economy expanding 6.4 percent this year, down from an earlier estimate of 6.8 percent, and 6.7 percent in 2019 from the previous projection of 6.9 percent.
The agriculture sector is now the weakest link in the economy. That is ironic, considering that the Philippines is still an agriculture-based economy, with 26 percent of the population depending on it for livelihood.