RP to cope with crisis through farm fundings

Department of Agriculture Secretary Arthur Yap said the Philippines can better cope with the global financial contagion through large investments in rural infrastructure and extension work that will raise palay yields and cut annual rice imports.

Through the DA Press Office, Yap reportedly said in a press conference recently that one way for the country to contain the adverse impact of the global economic crisis is to raise spending in agriculture.

The agriculture sector accounts for 16 percent to 17 percent of the country’s Gross Domestic Product (GDP) and employs 11.9 million Filipinos or a third of the national labor force, said Yap.

“Agriculture spending is rural development spending. Spending on agriculture creates a great multiplier effect on the domestic economy, not only in terms of generating income but in spurring consumption as well,” he said.

“The imperative is that before this contagion hits us, we must spend more on agriculture infrastructure in order to further raise production and create more jobs in the rural sector,” he further added.

This proposed higher spending on Philippine farms must be accompanied by “a shift as well in spending priority on infrastructure and extension work” in order to quickly expand domestic production and let Government cut back on its costly rice imports, which east up a hefty chunk of the country’s dollar reserves, said Yap.

In the meantime, the Arroyo Cabinet has ordered the National Food Authority (NFA) to raise its procurement volume to one million metric tons (MT) or 10 percent of total harvests this wet or main crop season so that it can beef up its inventories with locally-sourced stocks and benefit more small farmers with its higher support price.

As ordered by President Arroyo during the summer crop, NFA had increased its palay support price to P17 a kilo from last year’s rate of P12.

And as result of this Cabinet directive, the NFA has so far bought 246,631 metric tons of palay from farmers for the last September and October main harvest season, which is close to eight thousand percent higher than the 3,052 MT of palay that the food agency purchased during the same period last year.

Yap’s proposed spending shift merges with his earlier move to streamline beginning next year the implementation of the DA’s rice program under its banner “Ginintuang Masaganang Ani” (GMA) by focusing on funding hard or “big-ticket” projects covering irrigation maintenance and rural extension work along with post-harvest facilities and  farm-to-market roads (FMRs).

During the business conference, Yap also said that irrigation maintenance should top spending priority because so far only 1.5 million hectares are serviced by irrigation facilities while the rest depend only on rainfall.

To raise yields, he said the government will have to bring irrigation intensity to 200 percent so that systems can be used in both dry and wet planting season.

Although record spending under the incumbent government has led to a higher annual farm growth average of close to 4 percent a lot more has to be done for the Philippines to attain 100 percent rice sufficiency and be at par with Asia’s major growers like Thailand and Vietnam, said Yap. — Rhia de Pablo