MANILA, Philippines - The Rural Bankers Association of the Philippines (RBAP) has expressed concern the El Niño phenomenon and other consequences of climate change on crop production may have a devastating effect on microenterprise.
The rural bankers discussed the consequences of climate change that affect the rural economy in a forum organized by the British Embassy and the RBAP. They tapped experts to talk about measures to manage the impact of El Niño and other climate change-related occurrences and to provide farmers with helpful information to deal with the issues that affect their livelihood.
A study by the Asian Development Bank (ADB) on the economics of climate change indicate that increased frequency and intensity of extreme events, including temperature increase, have affected the country’s agricultural production, with projections pointing to impacts on Mindanao and areas of Luzon, putting even greater strain on food security.
The impact to both farmlands and small businesses in rural areas will be devastating. Furthermore, any change in agricultural output would affect micro enterprise as these are closely related to the support structure in the rural economy, the study noted.
El Niño has already struck in several parts of the country, causing a shortage of rainfall for both farmers and fishpen operators. The Magat Dam, a source of irrigation for 85,000 hectares of farmland in Central Luzon and 360 megawatts (MW) of electricity for the Luzon grid, is currently at its lowest water elevation at 163 meters.
As a result, the province of Isabela has already been placed under a state of calamity due to the dry spell that has beset the area for a month now.
Southeast Asia climate change network head John Pearson and ADB assistant chief economist Dr. Juzhong Zhuang both warned that climate change, if not addressed, would have an effect of a reduction in the gross domestic product by at least 6.7 percent for countries in Southeast Asia.
Pearson added that the rural banking sector is a vulnerable area due to the fact that it has one million borrowers, six million depositors and 700 branches across the country.