Philippine rice crisis due to bad policies, not shortage, says economist

Channel NewsAsia 21 May 08;

MANILA - The rice crisis affecting the Philippines is not caused by a shortage of rice but due to bad policies that have hurt the agriculture sector, a leading economist said in a report released Wednesday.

"The so-called rice crisis is really an income crisis," said Rolando Dy, executive director of the food division of the Manila-based University of Asia and the Pacific.

He blamed "under-investment in agriculture and infrastructure, a poor record in eliminating poverty (and) poor infrastructure quality," for the crisis which has forced thousands of poor Filipinos to line up for hours for subsidised rice.

"We cannot reap what we did not sow. We failed in reducing rural poverty compared to other countries," like China, Indonesia, Malaysia, Thailand and Vietnam, he said.

The Philippines is one of the world's biggest rice importers and does not enjoy large contiguous land areas with large river systems that allow China, India, Vietnam and Thailand to grow huge amounts of rice, Dy conceded.

But he said other countries which are more dependent on imported rice, like Malaysia and Singapore did not have long queues for rice and were not suffering from the crisis as badly as the Philippines.

Dy said that rice consumption in the Philippines was so high because much of its population was still poor and could afford to eat nothing else.

"There are so many poor people here, the only food they can afford is a mound of rice and some catsup (tomato sauce)," he said.

The Philippines could raise productivity but it had not properly invested in agriculture or its support infrastructure like irrigation and farm-to-market roads, Dy said.

He said the government was investing little in research and development, building sub-standard rural roads and not putting enough irrigation into potential growth areas like the southern region of Mindanao.

Dy also complained that an agriculture modernisation law that took effect in 2000 was not getting adequate funding.

Graft and corruption also hurt the agriculture sector with rural infrastructure being built to poor standards.

The rice crisis might even be a blessing in disguise because it "will spur production and even investments," in agriculture which will have a positive effect in the long run, Dy said.

But he said the rice issue is "a problem not just of the executive branch... it is a problem of the legislative and judiciary," as well.

Dy said that there is likely to be "some correction in rice prices in the next 12 months but not dramatically," remarking that world rice prices will not return to levels seen in 2006.

- AFP /ls