Displaying items by tag: Economy

NEDA warns of rice shortage if importation is deferred

MANILA -- The National Economic and Development Authority (NEDA) warned of a possible rice shortage if importation of the commodity is deferred until harvest season is over.

NEDA Secretary General Ernesto Pernia contradicted the position of the Department of Agriculture stopping rice imports while Filipinos farmers are still harvesting, a report by Jam Sisante on Balitanghali said on Wednesday, April 19.

"We don't have the capacity to produce enough rice. We are not really a rice-producing country. Inflation will strike," Pernia said.

Agriculture Secretary Emmanuel Piñol said deferring rice importations for now would not stoke inflation.

"Ang sinasabi lang namin ay idefer muna dahil sasabay sa harvest," he said.

"How can a temporary deferment of importation cause inflation? Paano?" he added.

Should there be excess harvest, the price they sell it at would be too low, which means lower income for the farmers.

A group of economists are also concerned, saying rice prices will increase.

"Peligroso 'yan, sapagkat, una, baka magkamali sila o kaya ma-delay. Lalo na government' yan, may bureaucratic procedure,” said Calixto Chikiamco, president of the Foundation for Economic Reform.

The group wants to put an end to the National Food Authority monopoly on rice imports and for the private sector be able to buy the commodity from overseas. — GMA News

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Trump signs ‘Buy American, Hire American’ order

  • Published in U.S.

KENOSHA, United States — President Donald Trump moved Tuesday to make good on his emblematic pledge to “Buy American, Hire American” by tightening skilled-worker visa rules, but his room for maneuver remains limited without wider congressional reform.
Speaking in Kenosha, Wisconsin — one of the states that carried him to his upset victory last November — Trump vowed: “We’re going to do everything in our power to make sure more products are stamped with those wonderful words, ‘Made in the USA.'”
Like many of Trump’s executive orders to date, his newest decree will have little practical impact, but sends a signal for government agencies to come forward with ideas for reforming the country’s H-1B visa system.
Trump is looking to stamp out “abuses” of the time-limited work permits, which are pervasive in the US high-tech sector, as a first step towards reforming the regime.
Intended for scientists, engineers and computer programmers, H-1B visas have become an important gateway for the many Indians drawn to Silicon Valley. The United States issues 85,000 each year.
Trump’s decree namely instructs the Labor, Justice and Homeland Security departments to tackle abuses and draw up reforms aimed at bringing the program back to its original intent: awarding visas to the most skilled and highly paid applicants.
The Trump administration argues that the current system has led to a “flood” of relatively low-wage, low-skill workers in the tech sector — and in doing so has harmed American workers.
“We believe jobs must be offered to American workers first,” Trump said.
The US Chamber of Commerce voiced immediate reservations: While it agreed there was room for improvement of the H-1B program, it warned the Trump administration not to do away with it altogether.
“It would be a mistake to close the door on high-skilled workers from around the world who can contribute to American businesses’ growth and expansion and make the US more competitive around the world,” the business lobby said in a statement.
The White House sees the decree as a way to spur momentum towards a broader congressional reform of the H-1B scheme — whose outline remains unclear.
“This is a transitional step to get towards a more skill-based and merit-based version,” a US official told AFP. “There is a lot we can do administratively, and the rest will be done hopefully legislatively.”
In his maiden speech to Congress, on March 1, Trump had proposed introducing an Australian-style merit-based system to reduce the flow of unskilled workers into the United States.
Seeking momentum
Trump’s new decree also includes a “Buy American” component, calling for stricter implementation of existing laws that are intended to favor US-manufactured goods in public tenders.
Without making specific new announcements, the Republican president once more pointed the finger at the North American Free Trade Agreement between the US, Canada and Mexico, dubbing it “a complete and total disaster.”
“It’s been very, very bad for our companies and for our workers and we’re going to make some very big changes or we are going to get rid of NAFTA for once and for all,” he warned.
As Trump’s presidency nears the symbolic 100-day mark, the 70-year-old leader is looking to regain momentum on the domestic front after his flagship travel ban was blocked in court, and his vaunted health reform foundered in Congress.
Trump’s promise of an ambitious tax reform — another central campaign pledge that would notably involve slashing corporate taxes — is also struggling to take shape.
“Our tax reform and tax plan is coming along very well,” Trump said in Wisconsin. “It’s going to be out very soon.”
But Treasury Secretary Steven Mnuchin acknowledged in the Financial Times earlier Tuesday the reform would likely be delayed, calling the target of getting it through Congress before August “highly aggressive to not realistic at this point.” CBB

Agence France-Presse

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Inflation feared with gov’t directive on rice

President Rodrigo Duterte’s directive for the National Food Authority (NFA) to boost rice supply from local farms before considering importation could unduly drive up consumer prices, New York-based think tank Global Source said.
In a commentary titled “Inflation risk from rice policy?” by economists Romeo L. Bernardo and Marie-Christine Tang, Global Source said the policy could lead to the depletion of NFA’s inventory, driving up local prices.
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“The struggle that led to the President insisting on the NFA buying local rice risks the country’s rice stocks falling further [especially if domestic farm outputs fall short of expectations] and thus, domestic rice prices spiking,” Global Source said.
Global Source was referring to the conflict between majority of the NFA Council—the agency’s governing body comprised of NFA officials and economic managers from various departments—and NFA administrator Jason Laureano Aquino.
The majority, led by the council’s chair, Cabinet Secretary Leoncio Evasco Jr., wanted the NFA to continue accommodating inbound shipments through private-sector importation. Aquino had disagreed, pushing for government importation through the NFA itself.
Inflation trend to persist
The conflict led to the dismissal of Cabinet Undersecretary Maia Chiara Halmen Valdez, who represented Evasco in council meetings.
“Rice accounts for close to 9 percent of the CPI (consumer price index) basket and given the projected inflation path, double-digit increases during the lean months would push the headline inflation rate well over the upper end of the BSP’s (Bangko Sentral ng Pilipinas) inflation target band,” it said.
The BSP is bent on limiting average inflation this year within the range of 2 percent and 4 percent.
“Many economic watchers have raised concerns about recent increases in consumer prices. From below 2 percent in the 16 months to August 2016, the headline inflation rate climbed past 3 percent in February and March 2017,” Global Source said.
The think tank added that the BSP now expects the uptrend to continue through the third quarter, driving the figure “very close” to the upper end of the target range.
Global Source said the government’s latest rice policy is “an emergent risk that could ‘shock’ inflation forecasts.”
While both factions in the NFA Council bickered over how to import and beef up its stock, Global Source noted that inventory as of March was good for 12 days’ consumption only.
Importation to ease worries
The NFA is required by law to maintain a minimum stock good for 15 days for most of the year, but it must have at least 30 days’ supply during the lean months from July to September.
The country’s main crop is planted and grown during the third quarter, and harvest does not start until October.
Meanwhile, Aquino the NFA administrator said last Tuesday the agency was currently unable to buy palay as farm-gate prices averaged at P18.60 per kilo as of the last week of March, higher than the NFA’s price cap of P17 a kilo.
“With rice prices starting to inch up recently and import lags of anywhere from one to four months, a decision to allow importation would help allay fears of impending shortages that could lead to higher price increases in anticipation of the demand/supply gap,” Global Source said.
“To avoid delays in light of the internal NFA disagreement and ensure that a decision to import is quickly carried out, the President might as well decide also whether NFA itself should import or allow private traders to do it,” the group added.

By: Ronnel W. Domingo - @inquirerdotnetPhilippine Daily Inquirer

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