Farming upgrade key to inclusive growth

CEBU, Philippines - Modernizing the agriculture sector and empowering the farmers are the Philippines’ edge in spreading income, paving the way for the more effective “inclusive growth” path the country is aiming to hit at least in the next three years.

Economist Antonio Del Carmen of the Ateneo Graduate School of Business suggested that while the government will provide ways and programs to convert agricultural lands and farms to produce higher value crops, the private sector could also help significantly in this strategy by directing their orders from the farmers and eradicating the traditional existence of middle-men.

Del Carmen emphasized the importance of social entrepreneurship as a way for the private sector to help the government’s bid in pursuing inclusive growth so that the good economic prospects of the Philippines will be felt by the grassroots or majority of the population, specifically the farmers.

Likewise, Asian Development Bank (ADB-Philippines) senior country economist Norio Usui shared the same sentiment, saying  that  the country has huge potential for growth in the mango industry, although the government has yet to see the importance this industry first.

At present, the country’s policy makers do not seem to know how to help the mango industry, Usui said.

Usui also pointed out there are plentiful ways in exploiting the opportunities of mango export, as the world recognized Philippine mangoes are "one of the best."

A new ADB report indicated that even as the services sector is rapidly developing, it should not eclipse manufacturing (including agriculture) as an essential part of the growth formula for Asian countries, like the Philippines, to prosper and avoid the middle-income trap.

Meanwhile, ADB chief economist Changyong Rhee said in the report that modernizing the agriculture sector, as well as focusing on boosting the manufacturing attractiveness  will help provide jobs to the majority.

In Central Visayas, agriculture sector took a downturn in 2012 after posting a remarkable performance in the previous year to register a 9.9 percent drop in terms of agricultural production for the year.

A report from the National Economic and Development Authority (Neda-7) revealed that the dismal performance for the crop sub-sector  which accounts for more than 80 percent of the sector’s output, and the continued poor showing by the fishery sector largely contributed to the inferior performance of agriculture in the region in 2012.

The crop sector saw total output dropping by 11.4 percent last year, following dismal performances from corn, vegetables and industrial/commercial crops.

Only palay and fruits posted positive growth in outputs but these were not impressive enough to pull up the sector.

In Cebu, several corn farms were planted to cassava instead of corn as a result of the contract growing program of San Miguel Corporation. There were also corn farmers in the region who simply shifted to planting other crops such as mongo, camote, eggplant, spring onions, patola, and cucumber.

Economists believe that the government, as well as the private sector, should be able to see the importance and potential of the agriculture sector to pull up the inclusive growth direction of the country.

Better infrastructure, credit access to farmers and sound programs’ implementation are just few of the “home-works” the government and its policy makers should do, economists say.

On the other hand, the private sector  especially those companies that are in food businesses,  could also help by sourcing their requirements from the local producers. /JMD (FREEMAN)