DA 20/20 vision needed in 2020
For agriculture to succeed, the Department of Agriculture (DA) must have a 20/20 vision for the new year. Our agriculture is in deep trouble. Over the last six years, its growth has averaged 1.6 percent, compared to industry’s 6.8 percent. But there is hope.
Agriculture Secretary William Dar should be credited for the third-quarter agriculture growth turnaround from a 1.3-percent contraction to a 2.9-percent growth. This also compares favorably with the 0.9-percent contraction in the third quarter last year.
Full support must now be given to Dar, who is admirably leading the way. And since he has recently been confirmed as secretary by the Commission on Appointments, Dar can more confidently lead the DA. He must implement a 2020 vision for the DA’s underutilized capability, compassion and commitment.In the critical area of rice, this has been sadly lacking.
For the underutilized DA capability, the Alyansa Agrikultura (AA) and the Federation of Free Farmers (FFF) (which submitted documents for the DA rice investigation), are puzzled and disappointed. On Aug. 13, the AA submitted a formal request for the DA to do what the Department of Trade and Industry (DTI) had successfully done. On a “motu proprio” (translated as “on its own initiative”) basis, the DTI gave the ailing cement industry safeguards in the form of additional duties on justifiable international trade grounds. I was personally involved in this as a private sector participant. Therefore, I found it even more urgent and easier for the DA to get similar safeguards to protect the 11 million rice household members suffering from the unreasonably low 35-percent rice tariff.
This was followed up a few days later by the FFF. That was four months and 17 days ago. The DA is now saying they have to look at five baselines before proceeding. Despite a Dec. 6 letter requesting what those baselines are, there has been no response from the DA. There was also no response to the request for DA to give the computed rice tariff, which results in the imported being equal to the domestic rice price. After all this time, it is clear that the DA’s capability has been greatly underutilized.
The computed tariff that favors neither the imported nor the domestic product for the consumer’s benefit is the starting point used by many countries in determining the initial tariff. The tariff is then decreased on a specific time frame with the appropriate support measures. This way, the domestic producer is forced to compete or perish.
But the initial tariff should be reasonable, as dictated by the formula given here. If it is not correct, both our Republic Act No. 8800 and the World Trade Organization rules allow the safeguard of additional duties. Thirty-five percent is definitely not correct. It is causing severe damage to both the rice industry and rice farmers. However, the underused DA capability has stalled on this move up to now.
Without this capability being harnessed, compassion cannot be expected. This is because the basis for this compassion has not been determined. Last Dec. 28, a published news report from a Philippine Institute for Development Studies source stated: “Farmers’ income is flat initially after liberalization, and a 1.8-percent reduction is expected thereafter.”
Because of underutilized capability, the DA has not contested this up to now. Instead, a farmers’ group using Philippine Statistics Authority information reported that income after liberalization was definitely not flat. It decreased precipitously by 56 percent: from P32,000 per hectare last year to P14,280 this year. Despite this, senior government officials have said they could not review this issue until after at least a year. Meanwhile, the suffering rice farmers are concluding that government has no compassion.
With a lack of compassion seen because of DA’s underused capability in identifying the actual situation, commitment to address and solve this problem will consequently be lacking. As early as last Oct. 24, Finance Secretary Carlos Dominguez III said: “Apparently, they (the DA) don’t have the confidence in pursuing this idea, and maybe they don’t have all the numbers to their satisfaction.”
That was more than two months ago. Up to now, the DA has not adequately addressed the critical rice issue. It is imperative that as this year begins, the DA bureaucracy will fully support Dar’s 2020 vision of fully utilizing DA’s capability, compassion and commitment. Among other agriculture stakeholders, the suffering rice farmers are waiting, and hoping that 2020 will be a different and happy new year.
