Credit and extension unity needed for agriculture

At the May 17th Agriculture Credit Forum, agriculture extension was hardly mentioned. But if credit is made available with no financially viable projects coming from effective agriculture extension, the credit will never reach the farmers. Thus, there is a need for the leaders of credit and extension to work closely together.

Pablito Villegas, one of the leaders of the Philippine Chamber of Agriculture and Food Inc. (PCAFI), proposed specific elements for Landbank president Alex Buenaventura’s new paradigm: “Landbank will now go to the farmers, instead of the farmers going to Landbank.”

Some of these elements are:

Implement the government’s convergence policy for DA, DAR, DENR, DTI and DOST through integrated area development

Focus on areas with competitive advantage in terms of enterprise profitability, market access and competitiveness

Cluster enterprises with the aggrupation of core, related, supporting and allied industries

Enter into MOAs between Landbank, LGUs and converging NGAs to promote financing at the household or cooperative level using value chain financing schemes

Villegas cited a Landbank approach as a model: “LBP’s proposed corporate management system manifests profarmer institution arrangements within the value chain where the exploitative elements of the existing supply chain for agriculture products that make the farmers and fisherfolk poorer will be addressed and resolved.”

However, it is effective agriculture extension that can help create the viable projects that can access the available credit.

Through effective extension, the farmers will be able to identify, produce and market the products that can be financed by Landbank and other financial institution. But today, our agriculture extension system needs an overhaul to become effective.

Our 17,000 agriculture extension workers no longer report to the DA, where they used to get guidance and support. Because of the Local Government Code, they now report to the local government units. Though many LGUs are doing effective extension work, more are saddled with the lack of guidance, with some even using agriculture extension workers for other purposes.

Last year, the five-coalition Agri-Fisheries Alliance (AFA) had a focused meeting with Agriculture Secretary Emmanuel Piñol. The AFA identified credit (led by PCAFI representing agribusiness) and extension (led by the Coalition for Agriculture Modernization in the Philippines (CAMP) representing science and academe) as two necessary pre-requisites for agriculture growth.

Piñol strongly supports agriculture credit reform. For agriculture extension, he challenged CAMP to propose a much more effective system. In February 2018, he approved the piloting in three provinces of a CAMP-recommended collaborative Provincial Agriculture and Fisheries Extension System (Pafes).

On May 3 to 4, Fernando Bernardo and Tito Contado from CAMP mapped out strategies for the Eastern Samar Extension Team. The provincial agriculture extension team involves the provincial government (with support from the provincial governor himself), the mayors and their municipal agriculturists, the DA’s regional office and Agriculture Training Institute, the state universities and CAMP.

The consultation meetings are being held from June 4 to 22. Representatives of the team have already visited 14 of the 23 municipalities and the lone city of Eastern Samar. Thanks to CAMP’s global expertise, the approach draws lessons from 51 states in the United States, 47 prefectures in Japan and 2,300 counties in mainland China.

It is imperative that credit providers work closely with agriculture extension workers. This way, the twin priorities of credit and extension can be addressed effectively. Just as agriculture reforms were announced by the key government financial institutions at the May 17th Agriculture Credit Forum, the extension reforms suggested by the Pafes must now be implemented.

With the synergy from credit and extension, agriculture can finally move forward.