Declining agriculture is tipping point to economic downturn

Thank you for P8.8 billion, which effectively boosted the agriculture sector’s budget this year by 11 percent from last year’s P80 billion allocation – but money alone, as most of us know very well, is not enough to stop the sector’s continuing slide.

The most important problem stemming from a weakened agricultural sector is the inability of the country to sustain its continued growth in the medium term. Once again, we may find ourselves unable to maintain the “good grades” that we’ve gotten the past decade.

With almost half of the country’s population living in poverty and relying on farming and fishing to put food on the table, there is less chance for this sector to climb out of the cycle of poverty, if agriculture is not enhanced and modernized.

Good grades erased

With the continued growth in the country’s population, it’s just a matter of a few years before the situation will be reversed, with the economy not growing and “good grades” erased. Before you know it, more than half of the population will be living in poverty, and consequently, finding it more difficult to put enough food on the table to feed the family.

This is why inclusive growth, just as many economists and international institutions have been pointing out, is very important at this stage in the country’s economic programs.

We may be celebrating the continued glowing growth performance of the economy during the past years, but still without a solid growth platform for the future, this will be quickly eaten up – perhaps even negated – by overnight poverty.

Ignoring the swelling ranks of those stricken by poverty may be the easiest way, the tipping point in fact, for the country to lose its newly earned status as an emerging economy this side of the world.

Inclusive growth through agriculture

To avoid a reversal of fortunes, the same as what happened to the Philippines some decades ago that pushed it to become Asia’s sick man, the government must seriously pursue agricultural modernization – even protectionism, no matter how late in the global trade liberalization game.

Our farmers and fisherfolk should be helped to earn more through government interventions: better irrigation, lower cost of implements, improved access to the market with less middlemen, and better roads and mechanization.

The rural youth should be inspired to go back to farming because they will see a sure system that promises earnings from tilling the land. Honestly, employment in call centers or overseas jobs, or other existing industries will not be able to absorb the growth of the population from the countryside.

Quick fix not sufficient

Improving access to education, for example through conditional cash transfer programs like the Pantawid Pamilyang Pilipino Program or 4Ps, will help, but this will take time and only if those that get past primary levels will move on to the secondary levels.

In truth, the 4Ps is a quick fix to meeting the educational commitment under the Millennium Development Goals this 2015. Even then, despite the huge amounts of money spent to date, the goal that all children can complete a full course of primary schooling will not be met.

If the Philippines really wants to move forward in its goal of reducing poverty and inclusive growth, which tie up with the first MDG 2015 goal of eradicating extreme poverty and hunger, the most logical path to take would be buffering the country’s agricultural competitiveness.

This means pulling all stops to boost farm productivity, not just for stipulated components of the 2015 agriculture sector budget including rice self-sufficiency, rehabilitation of coconut farms, and fish landing facilities, but even for high-value cash crops, fruit trees, and livestock.

Modernizing Phl agriculture

This definitely means putting money for a number of important items that would bring Philippine agriculture to world-class stature. The biggest items, without doubt, would be the construction of more irrigation channels, repairs of existing canals, dams, and farm to market roads.

But all of these would be useless without the introduction of mechanized tools to help farmers improve land productivity, and also the development of a cost-effective system of bringing produce to the market that would eliminate unnecessary interventions by middlemen.

The mechanization level of Philippine rice farm lands, for example, is way below that of Thailand or India, two countries that provide for our imported rice supplies at prices way lower than what Filipino rice farmers can give.

Mechanization is seen to boost the amount of rice planted and harvested, thereby helping the country achieve its goal of rice self-sufficiency while producing surplus rice that could be sold to the world market.

There are other forms of technology interventions that could be introduced to other farms, notably for vegetables and fruits, that would help in bringing down unit cost of produce.

Transportation

To bring down the cost of transporting produce to the market, another aspect of Philippine agriculture that could enhance the productivity levels of farming in the country is transportation.

One school of thought here is to strengthen farm cooperatives so that they would be able to own not just machinery for land preparation, harvest and post-harvest, but also vehicles that will pick up produce from the farm and bring them to the local markets or to the ports.

The Department of Agriculture needs to play a big role in bringing technology, both hard and soft, to the farmers. The DA’s role should be to introduce innovations to improve farm productivity, and not just to solve problems like pest infestation after it has become a concern.

Imminent threat of food security

Food security is of paramount importance to a growing population that has breached the 100th million mark this year and has put the country on the map as having one of the biggest in the world.

With the agriculture sector’s contribution to the national domestic growth continuing to dwindle, this means the Philippines is growing more dependent on food imports to feed its growing population.

While imports – and global trade liberalization – have generally driven down prices of food commodities, therefore benefiting consumers, it is also an unnerving situation realizing that we are a nation that is becoming dependent more and more on other countries for food that we put in our mouths.

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