RICE SMUGGLING AND ITS EFFECTS
TO THE ECONOMIC GROWTH
IN THE PHILIPPINES
A Term Paper
Ms. Jenifer F. Nara
Faculty, English Department
Xavier University – Ateneo de Cagayan
In Partial Fulfillment
of the Requirements for the Course
(Writing Term Paper in the Discipline and Business Correspondence)
Reyjen Kate J. Enoy
Regine May U. Tadlas
October 2, 2014
Rice Smuggling and Its Effects to the Economic Growth in the Philippines Thesis Statement: Rice smuggling can heavily depress the economic growth of the Philippines because it reduces government revenues, hurts domestic rice industry, and distorts supply-and-consumption data used as reference for sound policy-making.
I. Rice smuggling can heavily depress the economic growth of the Philippines. II. Rice smuggling reduces government revenues.
A. Smugglers avoiding customs duties deprive the government of revenues. B. Rice import smuggling robs government revenues from uncollected taxes. C. Smuggled rice will not be counted in calculating the GDP of the country. III. It hurts domestic rice industry.
A. It affects local industries by distorting prices of commodities. B. Cheap smuggled rice can lower the price of local rice particularly during harvest season, which discourage local farmers to plant. C. It prevents domestic traders from engaging in the rice business because of unfair competition. IV. It distorts supply-and-consumption data used as reference for sound policy-making. A. The government will be using inaccurate supply-and-consumption data as reference for sound policy-making that later on may cause problems. B. Since smuggled rice is unaccounted supply, it makes the estimated figure of Per Capita Net Food Disposable (PCNFD) for rice seems smaller and it also decreases the Per Capita Rice Consumption (PCRC). C. A lower PCNFD, in turn, could underestimate the real rice import requirement of the country, which could put the country’s food security at risk. V. Conclusion
Rice, basically known in the Philippines as palay, bigas and kanin is the country’s staple food. A Filipino meal is not complete without it, whether in breakfast, lunch or dinner. An average Filipino consumes rice for about 12 kilograms per year, the sixth highest in the world (Cruz, 2014). The importers, rice farmers and consumers, domestic trades and even the government have the knowledge on its importance. However, importers always find ways to loophole, thus rice smuggling remains to be of great problem in the country. Rice remains to be the favorite product for smuggling. Early this year (2014), smuggled rice discovered in Davao city made it to the headlines of newspapers, radio, and broadcasted television news. Rice smuggling can heavily depress the economic growth of the Philippines because it reduces government revenues, hurts domestic rice industry, and distorts supply-and-consumption data used as reference for sound policy-making. The purpose of this paper is to explore in depth the economic effects of rice smuggling in the Philippines. This paper aims to answer the following questions: a) How rampant is rice smuggling in the Philippines?; b) What are the root causes of rice smuggling?; c) How does rice smuggling affect the local rice industry?; d) How does rice smuggling deprive the government revenue?; e) How does rice smuggling depress the Gross Domestic Product (GDP) growth of the Philippines?; f) What are the legal sanctions imposed by the government against rice smuggling?; and g) Why do countries impose prohibitions and restrictions to certain goods?. This paper will bring awareness to the public regarding on what the rice smuggling is all about...
References: A. Online Articles and Documents
Alberto, J. R. (2013, April 12). NSCB - How Important is Agriculture in the Economy?. NSCB News. Retrieved October 1, 2014, from http://www.nscb.gov.ph/beyond-the-numbers/2013/04122013_jrga_agri.asp#fig1
Analyzing The Rice Crisis in the Philippines. (2008, May 31). AEA Blog. Retrieved October 1, 2014, from http://ateneoeconomics.wordpress.com/2008/05/31/analyzing-rice-crisis-in-the-philippines/
Cabacungan, G. (2013, December 30). 'Rice smuggling costs PH P7B a year '. Inquirer News. Retrieved October 1, 2014, from http://newsinfo.inquirer.net/554419/rice-smuggling-costs-ph-p7b-a-year
Emmanuel, A. (2013). Rice Smuggling: have we learned yet?. PDF, 5(19), 13. Retrieved October 1, 2014, from https://www.senate.gov.ph/publications/taxbits 2019 20vol5 20May 20- 20J
Philippines Per Capita Rice Consumption Decreasing Since 2008, Says BAS. (n.d.).Oryza. Retrieved September 25, 2014, from http://www.oryza.com/content/rice-consumption-decreasing-philippines-2008-says-bas
Ranada, P. (2014, August 13). Alcala: PH 98% rice self-sufficient in 2014. Rappler. Retrieved October 1, 2014, from http://www.rappler.com/business/industries/247-agriculture/66110-alcala-98-percent-rice-self-sufficient
B. Unpublished Theses
Cruz, C. J. (n.d.). Surveillance of the Philippine Rice Market. Bangko Sentral ng Pilipinas. Retrieved September 2, 2014, from http://www.bsp.gov.ph/downloads/EcoNews/EN14-02.pdf
Litonjua, A., Bordey, F., & Paran, S. J. (n.d.). PalayCheck System ®. Pinoy Rice Knowledge Bank. Retrieved October 1, 2014, from http://www.pinoyrkb.com/
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