A NEW MAN­AGE­MENT STRUC­TURE FOR AGRI­CUL­TURE

Agriculture - - Comparisons -

BY MANY MET­RICS, Philip­pine agri­cul­ture trails its ASEAN peers by a mile. The peers are In­done­sia, Malaysia, Thai­land and Viet­nam.

What met­rics? Cur­rent lev­els of farm pro­duc­tiv­ity, long-term pro­duc­tiv­ity growth, crop di­ver­si­fi­ca­tion, and agri-food ex­ports. These re­sulted in the high­est level of ru­ral poverty at 30 per­cent in 2015 as com­pared to less than half in In­done­sia, Thai­land and Viet­nam. Malaysia had 1.6 per­cent ru­ral poverty!

Ev­ery ASEAN coun­try has dom­i­nant crops. Rice is com­mon among all. Tree-crops and aqua­cul­ture are the oth­ers. The com­mand­ing dif­fer­ence in farm pro­duc­tiv­ity is not in rice but in tree-crops and aqua­cul­ture de­vel­op­ment. For in­stance, the av­er­age Philip­pine ir­ri­gated rice yield is about 4.3 tons per hectare ver­sus nearly six tons per ha for Viet­nam, a dif­fer­ence of 30 per­cent. By con­trast, the av­er­age yield for rub­ber is al­most three­times and five times for cof­fee.

Agri­cul­ture has many struc­tural chal­lenges. Let us fo­cus on one - man­age­ment struc­ture.

Com­par­ing man­age­ment struc­tures, there are sim­i­lar­i­ties and unique­ness.

Philip­pines. The coun­try has one de­part­ment of agri­cul­ture (DA) (or min­istry in other places) for an­nual crops like rice, long-term crops (like co­conut and rub­ber), high-value crops (fruits and veg­eta­bles), live­stock and fish­eries. The Philip­pines has some 10 mil­lion hectares (ha) of farm­land and over 250 mil­lion ha of coastal wa­ters and ex­clu­sive eco­nomic zone (EEZ), in­clud­ing the nearly two mil­lion ha of Ben­ham Rise. And yet, fish is ex­pen­sive and seafood ex­ports are very low.

In­done­sia. It has two min­istries: Min­istry of Agri­cul­ture, and Min­istry of Mar­itime Af­fairs and Fish­eries. The lat­ter is strate­gi­cally im­por­tant due to the coun­try’s archipelagic na­ture (over 17,500 is­lands) and hav­ing one of the world’s long­est coast­lines and EEZ (about 600 mil­lion ha). For tree-crops, the nu­cleus-es­tate out-grow­ers’ schemes have strong pri­vate sec­tor en­gage­ment with lib­eral pub­lic land leases.

The coun­try has the largest farm area (over 40 mil­lion ha) and EEZ in the ASEAN. Tree-crops out­size rice nearly 2:1. The for­mer is dom­i­nated by oil palm, co­conut, rub­ber, cof­fee, and ca­cao (all world play­ers). Rice sup­plies do­mes­tic needs.

Malaysia. There are two min­istries: the Min­istry of Agri­cul­ture and Agro-based In­dus­try (MOA), and Min­istry of Ru­ral De­vel­op­ment. The for­mer cov­ers rice, other short-term crops and fish­eries. The lat­ter cov­ers tree-crops un­der the Fed­eral Land Con­sol­i­da­tion and Re­ha­bil­i­ta­tion Au­thor­ity (FEL­CRA) and Rub­ber In­dus­try Small­hold­ers De­vel­op­ment Au­thor­ity (RISDA). The Fed­eral Land De­vel­op­ment Au­thor­ity (FELDA) was trans­ferred to the Prime Min­is­ter’s Of­fice by For­mer Prime Min­is­ter Na­jib Razak for po­lit­i­cal rea­sons in 2004.

Malaysia has a farm area of about seven mil­lion ha: 6.5 mil­lion ha for tree-crops, mainly oil palm and rub­ber, and 400,000 ha of rice. It im­ports some 30 per­cent of lo­cal sup­ply. Please note that MOA cov­ers the agroin­dus­try.

Thai­land. It has one big min­istry, but its agri­cul­ture is glob­ally com­pet­i­tive across many prod­ucts. Hav­ing been to Thai­land many times and work­ing as econ­o­mist in ru­ral roads in my younger days, I see its good ca­reer ser­vice, great road in­fra­struc­ture and ded­i­cated re­search as the big dif­fer­ence, among oth­ers. Thai­land has in­vested well in higher agri­cul­ture ed­u­ca­tion. Gone are the days when the coun­try sent stu­dents to UP Los Baños.

The coun­try has some 20 mil­lion ha of phys­i­cal farm land, but lim­ited EEZ. But a key ad­van­tage is that it con­sists of one land mass that low­ers lo­gis­tics cost.

Viet­nam. The coun­try has the fastest growth in agri­cul­ture over decades in the ASEAN. It has also one min­istry, the Min­istry of Agri­cul­ture and Ru­ral De­vel­op­ment (MARD). It is a global first in black pep­per, cashew and cof­fee, third in rice and rub­ber de­spite be­ing a late comer in the game. It is a global player in shrimp and fish cul­ture.

Sim­i­lar to Thai­land, Viet­nam has one land mass. The Gov­ern­ment though owns all the farm lands and does long-term leases to farm­ers and agri-pro­cess­ing fac­to­ries. WHERE TO PHILIP­PINES? The DA struc­ture has been prac­ti­cally the same over many decades. At the same time, agri­cul­ture per­for­mance is poor, and in turn, ru­ral poverty, re­mains very high rel­a­tive to ASEAN peers. To­day, there are some 18 mil­lion ru­ral poor, mostly are farm­ers and fish­ers, and land­less work­ers.

Mad­ness is do­ing the same thing over and over again and ex­pect­ing dif­fer­ent re­sults, to para­phrase a quote at­trib­uted to Al­bert Ein­stein.

It is time for soul-search­ing. To suc­ceed, the present DA needs a su­per­man and a su­per team. Un­for­tu­nately, with its po­lit­i­cally-tainted ca­reer ser­vice, that is an im­pos­si­ble dream.

It is also time to as­sess the DA and con­duct dili­gence on split­ting it into three de­part­ments: DA for an­nual crops, De­part­ment of TreeCrops for peren­ni­als like co­conut, rub­ber, cof­fee, ca­cao, oil palm, black pep­per, etc.; and De­part­ment of Fish­eries and Aqua­cul­ture.

Will this pro­posal in­crease the op­er­at­ing costs? Yes and No.

Yes, but the ben­e­fit will be greater than the costs as fresh man­age­ment is in­jected into the two new de­part­ments. No, be­cause part­ner­ships with lo­cal gov­ern­ments, peo­ples’ or­ga­ni­za­tions and state uni­ver­si­ties can be ex­plored. Tech­ni­cal ex­per­tise can also be pro­cured.

A great ben­e­fit is fo­cus by each de­part­ment sec­re­tary. The two new sec­re­taries can­not be sub­jected to rice self-suf­fi­ciency is­sues. Putting in the friendly com­pe­ti­tion among them will be healthy.

An LGU leader opined:“A bet­ter struc­ture may be best achieved by split­ting DA into two DA (for an­nual crops and live­stock) and De­part­ment of Fish­eries and Aquatic Re­sources. When sep­a­rated, each agency struc­ture will be nar­rowed and be­come more con­cen­trated on its own ban­ner pro­grams. It may also of­fer so­lu­tions for some con­cerns: elim­i­nate bias in the de­part­ment’s lead­er­ship in the pri­or­i­ti­za­tion of pro­grams and pro­jects and place­ment of com­pe­tent peo­ple in key po­si­tions.

Wor­thy to note also is that dif­fer­ent re­gions, prov­inces and mu­nic­i­pal­i­ties do not have the same re­sources as to crop­land and aquatic re­sources for de­vel­op­ment.”

The gov­ern­ment cre­ated two de­part­ments out of the orig­i­nal De­part­ment of Trans­port and Com­mu­ni­ca­tions – the De­part­ment of Trans­porta­tion, and the De­part­ment of In­for­ma­tion and Com­mu­ni­ca­tions Tech­nol­ogy – to bet­ter ad­dress pro­gram and project man­age­ment and im­ple­men­ta­tion. Why can’t the same be done for the more com­plex and poverty-al­le­vi­at­ing DA?

Will two sep­a­rate agen­cies do it? What about the un­pro­duc­tive treecrops group of co­conut, cof­fee, co­coa, rub­ber and oil palm? Who will shep­herd it?

Al­fred Chan­dler, fa­mous busi­ness his­to­rian once said, “un­less struc­ture fol­lows strat­egy, in­ef­fi­ciency re­sults”.

The busi­ness-asusual ap­proach will not solve the agri­cul­ture un­der­per­for­mance and high poverty. As is, the Duterte ad­min­is­tra­tion plans to re­duce ru­ral poverty from 30 per­cent in 2015 to 20 per­cent in 2022. To­day, In­done­sia, Malaysia, Thai­land, and Viet­nam half av­er­ages 10 per­cent, half the Philip­pines tar­get of 20 per­cent!

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