Press Release
September 3, 2018

Drilon: 'We cannot repeal the law of supply and demand'
He urges govt to provide long-term solutions to insufficient rice supply

"It all boils down to the law of supply and demand," Senate Minority Leader Franklin M. Drilon said on the issues of rising prices of rice, rice shortage, and the President's threat to raid rice warehouses in the country.

"Today, we talk about rice smuggling, high prices of rice, and the President threatening to raid the warehouses. You know, if there is one thing that we cannot repeal is the law of supply and demand," Drilon said during the contract signing for the construction of the P11.2-billion Jalaur River Multi-purpose Project Phase II (JRMP II) on Monday at the National Irrigation Authority (NIA).

When the supply is low and the demand is not addressed effectively, then the results are, inevitably, rice shortage and high prices of rice, he added.

Drilon said that the raiding of warehouses is a band-aid solution, but what the country needs is long-term solutions that will build-up the agriculture sector.

"The long-term solution therefore is to provide support to our farmers," said Drilon as he urged the administration to prioritize the construction of agricultural infrastructure in its Build-Build-Build program

"The administration should give priority to agricultural infrastructure in the Build-Build-Build program, because this will provide us with the long-term solutions to food security. This is critical for our food security," Drilon stressed.

If you look at rice exporting countries, Drilon said, they have critical ingredient in their agricultural production, particularly irrigation, citing Vietnam's Mekong River.

"In the Philippines, why is there rice shortage? Because we don't have sufficient production. Why is the production side not enough? Simply because we lack the critical ingredient to agricultural productivity, which is agricultural infrastructure that can support our farmers," Drilon said.

Drilon lamented that the agriculture sector was not a priority under the government's Build-Build-Build program.

"While the construction of roads and bridges is good and which is something I support, I think this huge infrastructure undertaking should have taken into consideration the state of our agricultural infrastructure," Drilon said.

He said that in the country, irrigation projects would take decades to be fully implemented, citing the construction of the P11.2-billion Jalaur River Multi-purpose Project Phase II (JRMP II), which took 58 years before its second phase is funded, and the Halog Dam in Ilocos Norte, which was stalled for 30 years.

"All these derailed infrastructure are vital for our farmers and in our bid to enhance agriculture productivity. The government should prioritize their construction in order that we can achieve rice self-sufficiency and help our farmers become more productive," Drilon said.

Drilon said the JRMP II will enhance agricultural productivity and prevent shortages of agricultural products, particularly rice, in the future.

The project, according to the senator, will contribute to the country's rice production target of 7.6 percent, as it will increase annual production of rice to 300,000 metric tons from 140,000 in Iloilo. The project will provide year-round irrigation to 31,840 hectares of farm lots in the province.

It was Drilon who initiated the project in April 2011 when he met with the Korean government for the funding requirement. The Korean government through its Export-Import Bank's Economic Development Cooperation Fund extended P8.95-billion as official development assistance. The government counterpart fund is P2.2 billion.

The interest rate for the Jalaur project is the lowest the country can get at 0.15 percent compared to loans being offered by China, which is roughly at 2.3 to 3 percent.

JRMP II includes the construction of 109-meter Jalaur high dam, 38.5-meter afterbay dam, 10-meter Alibunan catch dam, 80.74-kilometer high line canal; generation of new areas for irrigation; and rehabilitation of existing irrigation system.

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