The Department of Trade and Industry is mandated to help industry, while the Department of Agriculture is supposed to help agriculture. However, because of the critical link between industry and agriculture to achieve economic development, the DTI should also help farmers and fisherfolk by closely interacting with them and the DA.
The table highlights our three sectors’ contribution to our Gross Domestic Product (GDP) in 2014.
Agriculture growth is significantly below that of industry and services. What is not obvious is that agriculture components form a large part of industry.
Manufacturing, which is the largest part of industry, contributes 22 percent of GDP. Of the manufacturing subsectors, food manufacturers constitute the largest at 36 percent. This is followed by communication (17 percent), chemical and chemical products (11 percent), and furniture and fixtures (6 percent). The rest of the manufacturing subsectors are 2 percent or below.
Road maps
Asean integration starts very soon in December. We need a complete economic road map to address this integration, which is an opportunity but also a danger.
The Philippine Institute for Development Studies (PIDS), the government think tank attached to the National Economic Development Authority (NEDA), has received from DTI 26 industry subsector road maps. The DA has not yet submitted a road map for the agriculture subsector.
Since food manufacturers is the largest manufacturing subsector, it is imperative that the DTI knows whatever agriculture road maps there are. How can you plan the food industry when you don’t know the plan for its agriculture inputs? The PIDS must take the initiative and address this yawning gap.
In addition to road maps, there is the critical area of poor implementation. With former Trade Secretary Jose Concepcion and DTI Director Renato Navarrete, I helped introduced the ISO management system into the Philippines. The immediate objective was to enable our businessmen to export their products with ISO 9001 certification. This certification was the assurance to the world market that the firm producing the exports followed a globally accepted management system that would ensure proper implementation and quality products. But the intention was not to stop with the exporters. We advocated this for all public and private institutions.
Today, several institutions such as universities, hospitals, and government agencies have adopted this system. The DTI was the first in government to do this. With Asean integration looming before us, DTI should advocate that its partner, the DA, likewise undertake ISO accreditation. Farmers and fisherfolk complain about poor implementation, probably because there is no effective management system to improve this. Most DA bureaus and operating units still do not have ISO 9000.
Shipping lines
Last April 30, the DTI helped the Alyansa Agrikultura and other business organizations with certain shipping lines. Though many of the shipping lines behave responsibly, some are levying unjustified charges that contribute to unnecessary costs and harm our global competitiveness. These unscrupulous lines were not called to task for profiteering. This is defined in our law as charging a price for a product grossly in excess of its intrinsic worth.
One such charge that may have been appropriate before, but not anymore, is the Port Congestion Surcharge (PCS). But even when there was no more port congestion, many shipping lines continued to charge this. The Alyansa called on DTI to exercise the exemplary leadership they showed in using moral ascendancy when consumer product prices would become excessively high.
At last Friday’s press conference, DTI announced that the 11 major shipping lines carrying 75 percent of all cargoes had lifted the PCS. The DTI should call the attention of the remaining erring shipping lines so that this does not continue. There remain other charges believed to be unreasonable, such as the new Emergency Cost Recovery Surcharge (ECRS) and even a Cleaning Charge (CC) when these are not justified.
The DTI also issued this statement: “The DTI-Consumer Protection and Advocacy Bureau (CPAB) will look into the components of the shipping charges and utilize the public-private partnership model.”
DTI’s action on ensuring reasonable shipping charges will help all sectors, but especially farmers and fisherfolk who are at most risk from global competitiveness during the coming Asean economic integration.
Instances like these are within the mandate of DTI, and not DA. However, they affect the welfare of the farmers and the fisherfolk significantly. To achieve inclusive growth, DTI must look for more ways like this to help our disadvantaged farmers and fisherfolk.
(The author is chair of Agriwatch, former Secretary for Presidential Flagship Programs and Projects, and former Undersecretary for Agriculture, Trade and Industry. For inquiries and suggestions, email agriwatch_phil@yahoo.com or telefax (02) 8522112).
Sector % of GDP Growth (%)
Service 57% 6.0%
Industry 31% 7.5%
Agriculture 12% 1.9%