Agriculture: Still the most potent weapon against poverty

I was browsing over articles I have written and I stumbled on this piece that I find still very relevant, 15 years after.

Here are excerpts from that article published in 1999:

“A review of Philippine experience in managing economic development shows a strong bias against agriculture.

Since the 1950s, industrialization has been the main focus of economic policy that has its centerpiece strategy hinged on import substitution.

Food security, food self-sufficiency, agricultural and rural development, however, are nothing new in Philippine development planning.

In fact, the series of Medium-Term Development Plans which started in 1961 (then known as Five-year Socio-economic Integrated Progressive Plan) is replete with promises along these lines.

To attain sustainable development for the agriculture and rural sectors, I listed seven parameters for its realization.

1. Reengineering bureaucracy for agriculture with rural development

Past administrations have adopted the convergence zone concept in the pursuit of agriculture and rural development. It recognizes the reality that the areas of operation of the Department of Agriculture (DA), Department of Agrarian Reform (DAR) and Department of Environment and Natural Resources (DENR) converge on the physical and personal sphere (farmers being their common clients).

If such is the case, then there is wisdom in merging these departments to maximize resources, facilitate coordination and avoid the problems associated with “turfs.”

What seems to be logical in this merger is that the DA be the surviving entity. The functions of DAR can be made into a bureau (say Bureau of Agrarian Reform) and the function of DENR with respect to forestlands can also be made into a bureau (say Bureau of Forest Industry).

Agriculture, traditionally, has been defined as that sector of the economy that produces crops, livestock (including poultry), fisheries and forestry.

These sectoral groupings can serve as the basic framework for the bureaus under DA (i.e., Bureau of Plant Industry, Bureau of Animal Industry, Bureau of Fisheries and Bureau of Forestry).

Past policies, however, called for the creation of new departments bloating our bureaucracy. For economic and administrative expediency, it’s about time we put Humpty-Dumpty together again.

2. A new mindset: Agriculture as a business

Policymakers today and in the past show a strong bias for treating agriculture from the scientific and technical point of view. They forgot that farmers have to make money out of agriculture. Farming is not anymore just a way of life: Farming is a business.

The challenge that has to be faced in this paradigm shift is how to make agriculture profitable for farmers. The science side of agriculture is important but it is just one more production input. Farmers have to be taught how to manage their farms, finance their operations, market their products, etc. Unfortunately, agriculture graduates are not taught these nuances of farming business. It is no wonder why very few of agriculture graduates venture into farming. They’d rather work as technologists and researchers. Worse, many of them end up working in fields not related to their training or are unemployed.

3. Reinventing education for agriculture and rural development

Given the problem just cited, there is a need to overhaul, better still reinvent (reengineering is not the solution to this problem) education to prepare a corps of agriculture entrepreneurs and agribusiness professionals who will serve in agriculture and rural development projects.

The present curriculum in agriculture will answer the need for scientists and technologists.

But there is a need for a new program that will prepare people to be agriculture entrepreneurs and agribusiness managers.

These programs will have to be offered as business or management courses but definitely not under Schools of Agriculture.

A reform of the present educational system is also called for so that high school and post-secondary programs can be geared toward vocational agriculture courses.

Such courses, however, should provide a ladderized approach so that those with aptitudes can proceed smoothly to bachelor and even graduate courses.

Farmers training through nonformal education and extension services must be pursued vigorously. We don’t have to wait for the next generation of entrepreneur-farmers. We just have to help farmers of today to be farmer-entrepreneurs through education and training.

4. Systems approach and development planning

Agriculture is just one component of a whole set of activities from the farm to the dining table.

Thus, any effort to develop any agricultural commodity should not just stop at increasing yields at the farm level but should also incorporate a total systems approach in commodity planning.

In the case of rice alone, close to 30 percent of production is lost due to post-harvest losses. This highlights the need for processing facilities, transport facilities (including good roads and ports) and all that are required to bring products from the farm to the consumer (local and abroad).

5. Investment-friendly regime for agribusiness

The Comprehensive Agrarian Reform Program (CARP) is a Damocles sword hanging on the heads of people who have ventured into agricultural enterprises.

The confiscatory nature of CARP has stymied investments into agriculture and is a major reason for the decline in the productivity of the agricultural sector over the past years.

Even beneficiaries of land through CARP find it hard to use their land as collateral since banks shied away from lending to such “small” accounts.

Given the dismal record of land reform in this country, it is about time we reexamine if it is really for the best interest of small farmers. I think otherwise. Thus the best thing is to do away with CARP.

To help small farmers, focus should now be given on how to make existing farms more productive. Government can do its share but again knowing the dismal record of government to provide the needed support, the private sector (business and social development organizations) must be given the leeway to do the job.

For the business sector, incentives must be given irrespective of the type of ventures as long as they are related to agriculture.

For the social development organizations (SDOs), government should seriously consider sub-contracting their services, i.e., contract out to SDOs services like training and extension.

6. Promote off-farm activities in rural areas

The high rate of unemployment and underemployment in the rural areas, due partly to the seasonal nature of agriculture, requires the need to provide employment opportunities off the farm.

Small- and medium-scale enterprises that make use of agricultural products as raw materials like food processing, furniture and fixtures, handicrafts, etc. can be given a big push by providing market linkages between the rural producers and urban consumers.

Export promotion of such products can also be pushed vigorously.

7. New organizational modalities for agriculture modernization

Large agribusiness concerns like San Miguel Corp. and multinational corporations like Dole and Del Monte are often accused of exploiting our natural resources.

But a reality check shows that these agribusiness enterprises provide an honest-to-goodness service to the country by creating employment opportunities for the rural poor and earning the needed foreign exchange earnings by bringing Philippine products to the world.

As contrasted to their past practice of corporate farming, more and more of these agribusinesses are striking partnerships with small farmers through contract-growing, nucleus-estate development and satellite farming.

Such organizational modalities should be encouraged by providing them the necessary incentives and even equity financing.

Agricultural and rural development still promise to be the most potent weapon for combating poverty in the country.”

Maybe it’s too late for P-Noy to act on these items given his present pre-occupations.

I just hope the next President will put high priority to developing agriculture and the rural areas.

(This article reflects the personal opinion of the author and does not reflect the official stand of the Management Association of the Philippines. The author is a member of the MAP Agribusiness and Countryside Development Committee, the Project Manager for MAP’s Farm Business Schools project and the Dean of the MFI Farm Business School. Feedback at <[email protected]> and <[email protected]>. For previous articles, please visit www.map.org.ph)