The credit plan was prepared in collaboration with key government institutions involved in agricultural finance, such as Land Bank of the Philippines, Quedancor, Philippine Crop Insurance Corp. (PCIC) and the Bangko Sentral ng Pilipinas (BSP).
AMCFP has released P102 million in loans for agriculture and fisheries sector. Quedancor is also targetting to provide guarantee cover to P448 million agricultural loans in 2004 and P573 millions more in 2005. PCIC has planned to provide P6.6 billion in 2004 and P7 billion in 2005 insurance cover for palay, corn, high value commercial crops, livestock, poultry and non-crop commodities.
More than 283,000 smallholders from the food producing sector were able to get loans channeled through 600 cooperatives and 200 rural financial institutions.
The ACPC plan also projects that the agriculture and fisheries sector will continue to experience a credit gap averaging P400 billion yearly over 2004-2005 due mainly to the continuing high risks resulting from low profitability, the lack of collateral and unpredictable weather involved in agricultural lending.
ACPC continues to collaborate with both government and private banks in order to encourage the latter to increase their agri-lending. PD 717 or the Agri-Agra Law which mandates banks to set aside 25 percent of their total loanable funds for agriculture (15 percent) and agrarian reform (10 percent).
Over compliance in 2003 with PD 717 amounted to P263 billion representing 27 percent of the banks’ total loanable funds, 2 percent more than that specified in the law. This signified an increase of about P9 billion from banks’ compliance in 2002 which stood at P254 billion. – Ramon Ma. Epino