Philippines: NEDA wants tariff cuts extended for one year

Pork, corn, rice, coal

MANILA, Philippines — The National Economic and Development Authority (NEDA) is pushing for the extension of the reduced tariffs for pork, corn, rice and coal, at least for another year, as prices remain elevated.

Socioeconomic Secretary Arsenio Balisacan said during the Saturday News Forum that the NEDA Board has endorsed the draft executive order (EO) for the extension.

The board chaired by President Marcos met on Friday and endorsed the draft EO extending the temporary lowering of tariff rates on various products such as swine meat, corn, and rice until Dec. 31, 2023.

Meanwhile, Balisacan said that the extension of the lower tariffs on coal, meanwhile, would go beyond next year but would be subject to a review every semester.

Following the endorsement, Balisacan told reporters it is now up to the President to sign the order.

He said the EO for the extension needs to be issued within the month, as EO 171, which was issued last May for the reduced tariffs would be in effect only until the end of the year.

Without an EO for the extension, he pointed out that there would be a return to the old regime of higher tariffs.

“We don’t want higher tariffs when prices are very high,” he said.

Last month, the country’s headline inflation rate hit a 14-year high of eight percent, largely due to faster increases in food prices.

For the January to November period, inflation averaged 5.6 percent and exceeded the two to four percent target of the Bangko Sentral ng Pilipinas (BSP).

“The extension [of reduced tariffs] will provide relief to poor and vulnerable segments of the Filipino population whose welfare is reduced because of high inflation,” Balisacan said.

He said through this policy, the aim is to augment domestic food supplies, diversify the country’s sources of food staples, and temper inflationary pressures arising from supply constraints and rising international prices amid external geopolitical conflicts.

“Food security and protecting people’s purchasing power remain as the government’s top priorities and are vital components of the PDP (Philippine Development Plan) 2023 to 2028. Through the temporary reduction of tariff rates on selected key commodities and our continuous efforts to address constraints in our value chains, we will ensure that Filipino families will have sufficient access to food, especially this holiday season and in the coming months,” he added.