DA, World Bank launch $1B transformation push
MANILA, Philippines – The Department of Agriculture (DA) and World Bank formally launched a $1-billion initiative aimed at transforming the Philippine agriculture sector in the next few years.
The Philippine Sustainable Agriculture Transformation (PSAT) Program aims to modernize the farm sector, boost farmers’ productivity and incomes, and strengthen the sector’s climate resilience.
“This financing allows us to raise farm productivity, stabilize food supply, and protect millions of livelihoods dependent on agriculture,” Agriculture Secretary Francisco Tiu Laurel Jr. said in a statement on Friday.
READ: Bigger war chest secured to modernize Philippine agriculture
“By strengthening value chains and building climate resilience, we are supporting rural incomes and reinforcing a key pillar of the economy,” he added.
PSAT is the country’s first project to utilize the World Bank’s Program-for-Results (PforR) model, which releases funds based on measurable outcomes instead of upfront disbursements.
The initiative, which will run until 2030, aims to help at least five million farmers diversify livelihoods, raise incomes and manage climate risks.
“Rural communities will benefit from modernized services, stronger value chains, and a more resilient food system,” Zafer Mustafaoğlu, World Bank Division Director for the Philippines, said.
PSAT is targeting an increase in rice-based farming output, enhancement of efficiency and climate resilience in value chains, and improvement in institutional performance.
“By linking farm productivity with supply chain upgrades and governance reforms, PSAT seeks to deliver measurable, end-to-end results across the full agricultural value chain,” the DA said.
Meanwhile, the multibillion loan uses disbursement-linked indicators (DLIs) that require the government to meet verifiable targets before accessingfunds.
Arnel de Mesa, Agriculture Assistant Secretary, said the department expects an initial $300-million release this year, once the PSAT is declared effective between late June and early July.
The World Bank and the Philippine government through the Department of Finance signed the loan agreement for PSAT.
De Mesa said the next step is securing a legal opinion from the Department of Justice to ensure the loan complies with Philippine Laws.
A $24.5-million Technical Assistance for Sustainable Agriculture Transformation (TASAT) grant will support PSAT’s implementation, primarily for capacity building.
TASAT includes a $14.5-million contribution from the United Kingdom through its Just Rural Transition Support Programme.
“Agriculture sits at the crossroads of climate change, food security and economic growth. As farmers face stronger typhoons, floods and disrupted supply chains, transforming agriculture is not just a technical task—it is a strategic necessity,” British Ambassador Sarah Hulton said. /pai
