May 25, 2022
The private sector has pressed government to bolster support for private businesses given the imminent “food catastrophe” arising from many global phenomena topped by the Russian invasion that compel food producers to ban export.
Russia, Ukraine, India, among others, have already stopped wheat exports while many other countries contemplate to keep their food production for their own security.
As such, Philippines faces food security threats, along with soaring food prices, because of its heavy food import dependence.
Philippine Chamber of Agriculture and Food Inc. (PCAFI) President Danilo V. Fausto said the private sector plays a critical role now that the country still lurks with travails from Covid 19.
“Government should provide the right environment and incentives for the private sector to invest, expand their production, value chain and supply chain logistics,” said Fausto at PCAFI’s first face-to-face assembly two years since the pandemic began.
“Government should not kill them with competition from cheap and subsidized imported products.”
While the Department of Agriculture (DA) has made importation its pivotal policy to produce food, this is a mere short term solution.
“Providing cheap food for the consumers and fighting inflation through imports is a short term solution. Producing our own food requirements, although a longer process, will be more sustainable for our people,” Fausto said.
The private sector provides 95% of the investments that bring about agriculture production, he stressed.
In the face of world hunger, the more should agriculture sector get a bigger share in budgetary increase even despite the country’s ballooning debt of P12.7 trillion.
“We appeal that food production should not be sacrificed as the Department of Budget and Management undertakes hair-cuts for future budget allocation.”
Livestock and poultry, contributing a third or 30% of agricultural production should get a sizable budget from only 3-4% of the DA budget.
With the supply of imported feed wheat now limited, local corn production should be raised. Corn supply is currently at measly 57% sufficiency level. Feed wheat is an alternative to corn which represents 60% of feed ingredients. Feed itself represents around 70% of cost in growing chickens and pigs.
Cheaper alternative to feed inputs should be tapped as those developed by Filipino scientists from University of the Philippines Los Banos.
DA should promote use of inorganic oil-based fertilizers, utilizing organic materials, resulting in equally high yield and efficient production of rice and other crops.
PCAFI expects ratification of the Philippine Livestock Industry Development Act.
It has repeatedly appealed for the establishment of a first border quarantine facility, undertaking food safety measures amid the debilitating African swine flu and fighting smuggling of agriculture products.
All tax revenues derived from imported commodities must be utilized to the same sector where it was generated to help develop the said industry.
If the Regional Comprehensive Economic Partnership (RCEP) is ratified, incentives should be given for export winners to expand jobs creation. More protection should be granted to losing products facing stiffer competition from imports.
“More products have to be supported to expand our variety of agricultural exports to bring in more dollars, We must not suffer the same fate from our painful lessons when we joined the World Trade Organization,” said Fausto.
“Appropriate laws were passed by Congress and the Senate. But the implementation of these laws were not done to keep our affected agriculture sub-sectors protected, compared to other countries like Vietnam and Thailand.”
PCAFI also presses government to implement the following long awaited programs.
- Establishment of reliable and real time data information system.
- Incentives to investments and easy access to credit and capital. Review of the implementation priorities of Philippine guarantee fund.
Out of the total outstanding guarantee done by Philippine Guarantee Corp. (PGC) of ₱207 billion, only ₱500 million is for agriculture credit and ₱300 million for micro small medium enterpries (MSMEs).
But a whopping ₱203 billion is allocated for real estate, benefitting big developers that do not need to be guaranteed by government.
The farm sector also needs more the institutionalization of the use of warehouse receipts in guaranteeing credit which is a former function of the bankrupt Quedan and Rural Guarantee Corp.
- Rationalizing legal framework for the use of generic seeds for corn and balancing the use of organic fertilizers to reduce dependence on expensive oil- based inorganic fertilizers
- Accelerate effort to farm consolidation and clustering for mechanization and economies of scale. (Melody Mendoza Aguiba)