Press Release
January 8, 2010

Villar: Transparency needed in P50-B rice import

Malacanang should invite Churchmen to sit in the team that will buy rice abroad to ensure that transactions in the planned P51 billion importation of the country's staple for this year are above-board.

"We need transparency in the biggest government transaction of the year. A mere $10 overprice per metric ton will already result in a 'tongpats' of P1 billion," Nacionalista Party president and standard-bearer Sen. Manny Villar said.

Villar said "tough negotiators" should also sit in the government procurement team for imported rice as a mere difference in the contract price would "spell millions if not billions of pesos in savings."

"We are not accusing anybody of anything, but we don't want our buyers - those who will spend our money - to be pussyfooting or playing under-the-table games with the sellers," Villar said.

As non-government personalities, Churchmen, including Catholic and Protestant bishops, are allowed under Republic Act 9184 or the Government Procurement Reform Law to sit as observers in government bids and awards committees.

Executive Order 662 further strengthened their role by allowing NGO representatives to sit in the private-public Procurement Transparency Group that will review contracts costing more than P100 million, Villar explained.

Projected to cost a minimum P50 billion, government's rice import this year, aimed at shoring up low domestic paddy yield, looms as the "biggest single buy" of the government.

Rice imports, for delivery in the first half of the year, are expected to hit 2.27 million MT. Of these, 1.82 million MT were contracted, mostly from Vietnam, in four tenders in November and December.

At an average $480 per metric ton, with a greenback fetching 47 pesos, total bill for the said volume is about P51 billion.

"Thus if we will pay ten percent more than what we should do, then we would have been cheated of P5 billion. This is an amount that can already buy 200 million textbooks. A $10 overprice will set us back by P1 billion," he said.

But Villar fears that rice prices will inch up due to a forecast global rice deficit of 6.7 million tons in 2010, as computed by a London-based research firm.

He said the country's "rice import spree" resulted from government's gross underspending in irrigation and postharvest. "We are reaping little because we have sown little."

Up to 17 percent of palay harvests, enough to plug the supply gap, are lost to lack of postharvest facilities like dryers, Villar pointed out.

"The backlog in "irrigable lands" now stands at two million hectares."

The result is that government is buying more palay from Vietnamese and Thai farmers than from its own, he said.

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