MIDA warns political parties of pressing need for food policy

Written by  //  April 4, 2012  //  General Biz News  //  No comments

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MIDA President Ferdysac Márquez

Saying that the food industry should be treated as part of the island’s social and economic infrastructure, the head of the Marketing, Industry and Food Distribution Chamber, known as MIDA, warned Tuesday of the “imperative” need to establish a permanent food policy for Puerto Rico.

During a news conference, MIDA President Ferdysac Márquez said the trade group has already met with and outlined its recommendations to the island’s political parties, namely:

  • Replacing property tax on food inventories with a fee when the product is sold;
  • Recognize a differential for the industry in energy costs to avoid the double impact on consumers brought on by constant food refrigeration;
  • Boost local agricultural production by refocusing incentives from production to compensate for success instead. Incentives should be expanded to include the whole chain as with the industrial incentive law so that distributors, wholesalers and retailers become interested in promoting these products. Similarly, purchases by the Departments of Corrections and Education should be streamlined, to reduce the annual $500 million cost;
  • Find a way to enter the federal Nutritional Assistance Program, which could provide more resources and give stability and security to those funds; and,
  • Ensure compliance with purchasing quotas related to drinks and cigarettes in military stores, because the use of this benefit for commercial purposes is representing multi-million dollar revenue losses to the government and businesses.

“It is certainly time to act,” Márquez said. “MIDA has been working with these proposals, some of which have been submitted in the past, but that now must be adopted.”

The proposals MIDA outlined to the political parties will be discussed during its annual convention in July, when the gubernatorial candidates will have the opportunity to respond and counter them, he said.

“Given that food is of public interest, the food industry should be treated as part of the economic and social infrastructure,” he said. “This fundamental difference, and even existential, should be reflected in our government’s public policy. However, in Puerto Rico there is no strategy or policy, or even basic data collection that allow knowing how the food supply chain behaves.”

MIDA Executive Vice President Manuel Reyes-Alfonso

Meanwhile, MIDA Executive Vice President Manuel Reyes-Alfonso noted that the food sector represents an industry with great potential to help the island’s economic development, if provided with the right incentives and regulations. Decisions regarding the food sector should carry a “broad vision that includes the entire chain,” he said.

“For example, it’s worth little to incentivize the farming sector if they aren’t provided adequate distribution or are given space on retail shelves,” Reyes-Alfonso said.

During the meeting with members of the local media, both executives also expressed concerns about maintaining appropriate competitive levels within the industry, taking into consideration that there is a need to have local capital present.

“We’re seeing a dangerous consolidation in the retail and wholesale sectors with the disappearance of important local chains, so it is imperative to address this issue,” Reyes-Alfonso said. “Unfortunately, current law do not provide for any analysis of competition unless it is required as part of a buyout agreement, which is not happening.”

He suggested strengthening local anti-monopoly laws, keeping close tabs on the planning and zoning impacts caused by new store openings, leveling the playing field for local companies, and avoid creating unfair competitive conditions by granting foreign companies public funds they do not need, among other necessary changes.

To implement those recommendations, the island would need to establish a Food Policy Council, as other stateside jurisdictions have done, he said.

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