THE 15% TARIFF on imported rice will remain unchanged at least until November, according to the Department of Economy, Planning, and Development (DEPDev), as the government seeks a “win-win” solution that balances inflation control with protecting local farmers.

“Not in the immediate [term], but most likely by November,” DEPDev Undersecretary for Policy and Planning Rosemarie G. Edillon told a news briefing on Wednesday. “After four months, we will submit the study to the President.”

The lower tariff was introduced through Executive Order (EO) No. 62, which took effect in July 2024 and slashed the import duty on rice to 15% from 35% until 2028. The EO mandates a review every four months to assess its impact.

The announcement comes amid a petition from farmer groups, including the Samahang Industriya ng Agrikultura, to go back to the original 35% duty to shield local producers from the influx of cheaper rice imports.

The Department of Agriculture, meanwhile, said it would recommend a gradual tariff increase during the next harvest season.

Ms. Edillon said they met to discuss the review and petition, and they agreed that the periodic review is meant to report on what has happened, not to make recommendations at this stage.

The lowered tariff appears to be achieving its inflation-control goals. Rice prices dropped by 14.3% in June, improving from the 12.8% decline in May, according to the local statistics agency. It was the sharpest drop since 1995.

Rice supply also appears to be stable. As of June, the country’s rice inventory reached 2.24 million metric tons (MT), 3.5% more than a year earlier. “Most of them are still in the warehouses. And we had the bumper harvest, actually, for the first half,” Ms. Edillon said.

She added that the rice import volume would be capped at 3.5 million MT for the year.

The government is also exploring more measures to support farmers, including enhanced access to the Rice Competitiveness Enhancement Fund, which provides planting assistance.

The DEPDev is also participating in discussions on whether to restore the regulatory powers of the National Food Authority (NFA), which was stripped of many functions following the Rice Tariffication Law.

Speaker Ferdinand Martin G. Romualdez said the House of Representatives is ready to act on a draft bill that seeks to reinstate the NFA’s market functions once it reaches the chamber.

The Agriculture department has said the draft legislation includes provisions for the NFA to manage buffer stocks, regulate rice marketing and set floor prices for rough rice.

“I think at that time, the context was different. So NFA was so much in debt. It was really bleeding, hemorrhaging,” Ms. Edillon said, referring to the agency’s former monopoly on imports. “It was not really fulfilling its mandate… What we need to consider now is how the market has adjusted to the new regime.”

She also acknowledged the challenges in setting floor prices. “It will be very tricky though, operationalizing it and even estimating it. But yes, that’s something that we’re studying as well.” — Aubrey Rose A. Inosante

THE P50 daily minimum wage hike for Metro Manila workers that will take effect on July 18 is unlikely to fuel inflation, according to economists.

Its limited coverage means it probably won’t be inflationary compared with earlier proposals for a nationwide wage hike, said Ruben Carlo O. Asuncion, chief economist at Union Bank of the Philippines, Inc.

“It’s going to take effect this month, so that has to be factored in,” he told Money Talks with Cathy Yang on One News on July 2. “But versus P100 to P200, I think P50 is a huge difference from the huge uptick that was originally proposed by Congress.”

The P50 wage hike is a “well-calibrated move,” said Jonathan L. Ravelas, senior adviser at Reyes Tacandong & Co.

“It boosts worker income without significantly stoking inflation,” he said. “Given current low inflation and soft growth, the impact should be manageable — especially if businesses adjust gradually and productivity improves.”

“It’s a positive step, but we’ll need to watch for second-round effects in labor-intensive sectors,” he added.

The Labor department last week said the P50 daily wage increase — the biggest pay hike ever granted by the National Wages and Productivity Commission — would benefit about 1.2 million workers in the Philippine capital and nearby cities and provinces.

The new daily minimum wage in the National Capital Region (NCR) is expected to increase to P695 in the nonagricultural sector.

The pay of workers in the farm sector, service and retail outlets with 15 or fewer staff members and factories with fewer than 10 workers will go up to P658.

Congress adjourned last month without approving the bill seeking to hike the daily minimum wage by P100-P200. Economic managers had warned that the legislated wage hike could have “dangerous repercussions” for the Philippine economy.

Philippine inflation picked up to 1.4% in June from 1.3% in May amid higher utility costs, the government reported on Friday.

This was slower than 3.7% in June last year and was within the central bank’s 1.1% to 1.9% forecast for the month. This was also below the 1.5% median estimate in a BusinessWorld poll of 17 analysts.

National Statistician Claire Dennis S. Mapa on Friday said the latest wage hike’s impact on inflation could be lagged, adding that this would likely be reflected in personal care, miscellaneous goods, and services.

Michael L. Ricafort, chief economist at Rizal Commercial Banking Corp., said a P50 wage hike that is given to other regions could add a percentage point to inflation.

“Businesses tend to pass the higher minimum wages, or pass-through effects, as much as possible, depending on competition locally and from imports,” he said in a Viber message.

Ateneo Center for Economic Research and Development Director Ser Percival K. Peña-Reyes said the NCR wage hike could “lead to job losses or inflation if the hike is merely artificially imposed and is not commensurate with any actual productivity increase.”

IBON Foundation Executive Director Jose Enrique “Sonny” A. Africa said the hike is “minuscule” and should not have any impact on consumer prices.

“The P50 NCR wage hike is just 0.4% of NCR establishment expenses and barely 2.5% of profits,” he said in a Viber message.

He added that “any firm that raises prices because of the tiny hike is just using that as an excuse for further profiteering.” — Aubrey Rose A. Inosante