MANILA, Philippines - The coconut industry stockholders favors the use of coconut levy funds for provision of farm inputs to coconut plantations and capacity building of coconut farmers, instead of distributing the proceeds in cash.
The Supreme Court has ruled with finality that the 24 percent block of shares in San Miguel Corporation—currently valued at P70 billion—were obtained using coconut levy funds and should be remitted to the government for the benefit of the coconut industry.
Militant group Kilusang Magbubukid ng Pilipinas (KMP) is demanding that the proceeds from the recovered fund be given to farmers in cash.
In a resolution passed during the First Coconut Farmers and Industry Stakeholders’ Summit hosted by the United Coconut Associations of the Philippines (UCAP) in Quezon City yesterday, industry groups expressed support for the plan of the government for the creation of a trust fund to hold the coco levy proceeds.
Agriculture Secretary Proceso Alcala said one of the salient points of the proposal or the creation of a trust fund is the investment of the funds in safe instruments so that the interest could be used for projects that have immediate impact on the industry.
“This money can be used for the capacity building of coconut farmers,†said Charlie Avila, executive director of the Confederation of Cococnut Farmers organization which participated in the summit.
“To make the trust fund sustainable, the capital of the trust fund shall be invested in government securities and that only the yield or interest on such securities shall be used to finance programs and projects for the benefit of coconut farmers and the development of the coconut industry. This way, the fund works like an endownment fund,†the resolution stated.
The coconut industry is also proposing that the trust fund be managed by a committee composed of representatives from the government, coconut farmers groups , industry and other industry stakeholders.
Alcala earlier said that based on the proposal to be submitted by the DA and coconut farmers, Malacañang would decide on the appropriate agency that would handle the funds. A team of fund managers would be formed to determine the priority areas for the fund as well as the financial instruments that would be used for its investment.
The industry groups said the fund should be used for coconut planting and re-planting, seed farm development, fertilization and pest control, provision of livelihood, provision of credit for business capital, education scholarships, research and development for technologies that would benefit the industry, and provision of insurance and health coverage for farmers.
“I’m very optimistic. With the use of the funds, the coconut industry can move on to the production of high value products like health and wellness products,†said Avila.
Alcala earlier said that in identifying the beneficiaries of the coconut levy fund, the Agriculture department would prioritize provinces that contributed to the fund but would no longer identify the contributors individually to save time and effort.
Avila said this is also understood by the industry.
Alcala estimates that out of the 80 provinces in the country, around 60 are actively engaged in coconut cultivation.
The Agriculture chief stressed the importance of developing high value products from coconut such as coconut water, coconut milk, coconut flour and others to lessen dependence on coconut oil exports. This would protect the income of farmers when prices are low.