President Ferdinand Marcos Jr. approved the importation of cheap fertilizer worth at least P4.16 billion from China that will be given to farmers for afree as a subsidy in a bid to support them while lowering food prices.
Mr. Marcos on Monday met with officials of the Department of Agriculture, which he concurrently heads, the Department of Trade and Industry, and the Philippine Trade and Investment Center (PTIC), the Palace said in a press statement released by the Office of the Press Secretary.
PTIC President and Chief Executive Officer Emmie Liza Perez-Chiong said her agency plans to buy an initial 150,000 metric tons of fertilizer this year from China at $470 per MT, for a total of $70.5 million or P4.16 billion, through a government-to-government arrangement.
The purchase is significantly lower from the current price of $650 per MT.
A memorandum of agreement between the PTIC and DA is now being drafted– a requirement for the importation plan.
The President said he will sign the MOA between the Agriculture department and PTIC this week, the Palace said in the statement.
Another requirement for PTIC’s fertilizer importation is a sovereign guarantee from the government-owned LandBank for a P1 billion credit line.
Mr. Marcos directed Finance Secretary Benjamin Diokno to extend the sovereign guarantee to PTIC’s credit line from the LandBank.
“I will also ask LandBank to allow DA to use its idle warehouses for the stockpiling of fertilizers,” the President said.
The PITC is the only state trading corporation in the country and has helped local businesses and agencies benefit from international trade since its establishment in 1973.
The DA has allotted P4.1 billion for subsidies to buy fertilizers to be given for free to farmers.
With the much lower cost, DA will be able to buy around 2.277 million bags of urea to be given to farmers through farmers’ groups and cooperatives.
The government plans to import around 300,000 MT of fertilizer to be used next year.
Aside from the PITC president and CEO, present during the meeting were DA Senior Undersecretary Domingo Panganiban and DTI Secretary Alfredo Pascual.
Earlier, the Department of Budget and Management said the government will be doling out P206.5 billion in subsidies and cash support to the most vulnerable sectors next year amid surging commodity prices brought about by global inflation.
DBM said this amount under the proposed 2023 national budget covers cash transfers and other subsidy programs of various agencies.
The Department of Social Welfare and Development (DSWD) will get a big chunk of the budget, with P165.40 billion allocated to various social assistance programs.
About P22.39 billion will also be provided for to provide medical assistance to indigent and financially incapacitated patients through the Department of Health (DOH).
The Department of Labor and Employment (DOLE), meanwhile, will get P14.9 billion next year for TUPAD, a program that provides emergency employment for displaced, underemployed, and seasonal workers.
The Department of Transportation (DOTr) will get P2.5 billion for fuel subsidies for the public transport sector.
The Department of Agriculture (DA) will get P1 billion to provide fuel assistance to corn farmers and fishers.
Other budget allocations in specific programs under the 2023 National Expenditure Program include P115.6 billion for the Pantawid Pamilyang Pilipino Program (4Ps); P 25.3 billion for Social Pension for Indigent Senior Citizens (SPISC); P19.9 billion for Protective Services for Individuals and Families in Difficult Circumstances (PSIFDC); and P4.4 billion for Sustainable Livelihood Program (SLP).
Mr. Marcos earlier ordered continued support to the most vulnerable sectors in the form of the distribution of cash transfers and fuel discounts to help cushion the impact of rising inflation.
The President made the directive after inflation in October shot up to an almost 14-year high of 7.7 percent from 6.9 percent in September, driven by faster increases in the prices of food and non-alcoholic beverages.
“These (cash transfers and fuel discounts) will be part of the government’s key response to rising inflation even as we continue to build on climate action and food security,” Office of the Press Secretary officer-in-charge Cheloy Garafil said.