Claim doesn’t match figures


Rigoberto Tiglao’s claim that $390 million or P16.6 billion worth of rice was smuggled from Vietnam is wrong. It is meant to justify a predetermined conclusion that “Rice smuggling explodes under Aquino” (Inquirer, 12/20/12).

Citing International Monetary Fund trade  statistics between the Philippines and Vietnam during President Aquino’s first two years in office, Tiglao anchored his analysis on the premise that 90 percent of Vietnam’s exports to our country is accounted for by rice. Therefore “the $433 million” difference between the two nations’ merchandise trade for all goods translates to $390 million in smuggled rice ($433 million x .90 = $390). Let’s amplify:

1. Published statistics of the General Statistics Office of Vietnam debunk Tiglao’s 90-percent claim, in that Vietnam’s rice shipment to our country for the period January  2011 to June 2012 reached only 35 percent of Vietnam’s combined exports to the Philippines. Compare this to the 72 percent in three years, from 2008 to 2010. In monetary terms, Vietnam’s rice exports to the Philippines declined from $3 billion (during the period January 2008-December 2010) to $704 million (during the period January 2011-June 2012). Twenty-five items, from instant noodles to iron and steel, comprise Vietnam’s exports to the Philippines. Why single out rice? Seven countries in the region are rice exporters. Clearly, the 90-percent benchmark did not take place in President Aquino’s first two years.

2. International rice price quotes determine domestic price behavior and belie Tiglao’s conclusion that domestic farm gate prices were down, that retail prices remained stationary from  2010 through December 2011 on to November 2012 due to “explosive” smuggling. According to the Food and Agriculture Organization, farm gate prices in truth rose from P15.34/kg in May 2010 to P16.18/kg in November 2012, up from a low P14.40 in December 2010, what with a  2.4 million-ton massive December 2009 importation that was scheduled for arrival in 2010 in several batches.

In US dollar terms, retail per-kilo prices rose 15 percent from $0.68 in May 2010 to $0.78 in November 2012, which price direction was consistent with price hikes that prevailed in the following countries: Vietnam from $0.32 (May 2010) to $0.43 (November 2012); Thailand from $0.36 to $0.52; India from $0.44 to $0.58; and Indonesia from $0.80 to $1.

Vietnam’s 25-percent brokens, the variety procured by the National Food Authority (NFA), were priced on average per-ton basis at $387 in 2010 compared to Tiglao’s $518; $464 in December 2011 versus his $620; and $418 in November 2012 against his $588. Clearly, global prices declined by 10 percent from December 2011, but rose 8 percent from  2010’s $387, yet NFA procured at $640-$700/ton.

3. Tiglao apparently missed an April 12, 2008, news item on two rice shipments worth P12.6 million that were seized at the Port of Manila, contradicting his “zero” smuggling theory.


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