Road maps and growthBy Ernesto M. Ordoñez
Philippine Daily Inquirer
Are road maps necessary to achieve growth? The Department of Budget and Management (DBM) appears to think so. The DBM has initially turned down the Department of Agriculture’s (DA) budget proposal of a 48-percent increase from P65 billion in 2013 to P96 billion in 2014. Instead, the DBM has recommended a 26-percent decrease to P48 billion… unless the DA submits road maps. But are road maps really necessary for agriculture growth?
In a radio interview two weeks ago, Agriculture Assistant Secretary Dante de Lima described how a soybean road map significantly boosted soybean growth.
When he joined the DA in 2010, De Lima saw how different soybean development activities were being undertaken without a road map to guide them. He started the development of a road map. He showed the potential of soybeans for human rather than animal consumption and refocused development to this area. He encouraged the research done at the University of the Philippines to be applications-oriented toward this end.
Finally, he promoted the development of the largely absent farm tools and postharvest facilities to support soybean growth. With the different players in the soybean area now following a common road map, soybean growth flourished.
When De Lima next took charge of the rice program, there was already a general rice road map. He has subsequently added more specific sections to this road map. Among these are local and international competitive analysis, climate change and the identification of critical sectors’ impact on rice growth.
Alyansa Agrikultura’s Omi Royandoyan earlier asserted that rice production benefited farmers with 3 hectares or more but not the remaining 90 percent of rice farmers with less than 3 hectares. De Lima said he favored a road map section precisely to address this issue and the larger problem of inclusive growth.
De Lima has already started providing these small farmers with better credit access through the SIKAT-SAKA program. This has been launched in Isabela, Nueva Ecija, Iloilo and North Cotabato. Loans are given directly to the small farmers with only a 15-percent interest rate. This way, the small farmers will now have the credit necessary to implement the new rice technology and consequently become part of inclusive growth.
Last May 14, the National Economic and Development Authority (Neda) Planning Committee for the agriculture and fisheries sector met to recommend improvements in the Philippine Development Plan 2011-2016. Some of the key recommendations approved followed the dictum of management guru Peter Drucker: “While it is important to do things right, it is more important to do the right things.”
Though it is important to eliminate corruption following P-Noy’s saying, “Kung walang corrupt, walang mahirap,” it is necessary to use our scarce resources in the right activities that produce the most benefit for our people. Deciding what these activities are should be done with the private sector. This follows P-Noy’s other direction of “Ikaw ang boss ko.”
A frequently observed practice that should be stopped is for a government agency to create a road map and then give this to the private sector for joint implementation. Instead, the public-private-partnership (PPP) approach advocated by P-Noy should be used.
There are two main benefits to this. The first is that the government will be able to get more complete information with private sector involvement. The second is that the private sector will be more committed to implementing the road map because they will have a sense of co-ownership.
The remaining challenge is to ensure quality in a PPP-formulated road map. Since the DBM has required road maps before it agrees to recommend increases in the DA budget, it should likewise look at the quality of these road maps to justify the budget increases. At the last May 14 Neda meeting, it was said that the DA road maps had different degrees of quality. This is partly because these road maps have no common guiding outline.
The DA planning official present during that meeting should be commended for being open to a suggestion for such a common outline to guide all DA road maps and help ensure quality. We need not reinvent the wheel.
The Department of Trade and Industry (DTI) already has a common outline to guide industry sector road map formulation. This includes necessary sections missing in some agriculture road maps. Examples are “global, regional and local markets,” “leading countries and companies,” and “industry and government development programs, including research and development, marketing and financial projections.”
The missing element in the DTI outline, which should be included in a proposed DA road map, is a section on inclusive growth, as De Lima advocates. With high-quality road maps developed using the PPP approach, we will be on our way to achieving not just growth but, more importantly, inclusive growth.
(The author is chairman of Agriwatch, former secretary for presidential flagship programs and projects, and former undersecretary for agriculture, trade and industry. For inquiries and suggestions, e-mail firstname.lastname@example.org or telefax (02) 8522112.)