Free land distribution won’t solve poverty – economists

A group of economists has warned that free distribution of land will not solve rural poverty in the country in light of reports that the government has finally agreed to the demand of the National Democratic Front (NDF) of the Philippines of free land for farmers in the ongoing peace talks.

Foundation for Economic Freedom (FEF) said in a statement that giving out free land will not affect the situation in the ground because only 17 percent of agrarian reform beneficiaries are paying their loan amortizations.

Therefore, farmers are effectively given their lands for free. Yet, agricultural productivity has remained stagnant and our farmers have remained poor.

"Giving out free land will just be a populist measure similar to free irrigation and free cavan of rice without really solving the fundamental problem of Philippine agriculture: Restrictions in the rural land market," FEF said.

To recall, government peace panel member Hernani Braganza said last week that giving free land to farmers may be the first few benefits that will be agreed upon between the Philippine government and communist rebels during the ongoing peace talks.

But FEF thinks this will not entirely solve the problem in agriculture as well as that of the farmers'.

"What Philippine agriculture needs is to provide the conditions for efficient farmers to introduce management, technology, and capital to farmlands by removing the restrictions on the rural land market," FEF said.

The group also believes that restrictions on rural land imposed by the Comprehensive Agrarian Reform Law only keep the farmers poor and from raising their agricultural productivity.

These restrictions include the prohibition to sell or mortgage the property within ten years from grant, prohibition to lease, and the prohibition to own more than five hectares of land.

"These restrictions prevent agrarian reform beneficiaries (ARBs) from accessing cheap loans from the formal financial markets and also prevent efficient farmers from working on larger tracts of land and buying out inefficient ones," FEF said.

So instead of giving free lands to farmers, FEF is proposing that ARBs be given unrestricted titles to their lands, instead of the collective Certificate of Land Ownership Awards (CLOAs) that rob farmers of economic freedom and private initiative.