Page last updated at 04:41 Asia/Manila, Wednesday, 03 September 2014 PH
After spending more than three weeks roaming around portions of Northern Mindanao, especially agribusiness paradise Bukidnon, I am positive that given the right agricultural policies, the land-rich island of Mindanao can play a significant role in supplying food--especially high-value crops--for the entire Philippines and in time for the whole East Asian region. It is impressive to see all types of crops--pineapple, bananas, corn, cassava, palm oil, coffee, rubber, cacao, etc.--thriving on the rich soil and temperate climate of this island. Unfortunately, as agribusiness savvy congressman Pedro Unabia remarked in a Kapihan I attended in Cagayan de Oro, Mindanao continues to be only a "land of promise," having failed to attain its full potentials, especially when compared to such neighboring countries as Thailand, Malaysia and even Vietnam that has already become a leading world player in coffee, cashew, pepper, prawn, not to mention rice and dory catfish. As prominent agribusiness economist, Dr. Rolando Dy--who hails from Davao-- informed several audiences also in Cagayan de Oro just a few days before, annual agricultural exports of Thailand and Indonesia exceed $40 billion, Malaysia over $35 billion, and Vietnam close to $20 billion. The Philippines is at a woeful $5 billion.
Our failure in agriculture is, however, mirrored most in the sorry state of poverty in the countryside. As pointed out in several emails I have received (among them is one from a concerned citizen, Leonardo Fuentes), the explanation can be found in a most scientific diagnosis made by national scientist Dr. Raul Fabella (a professor and former dean of the UP School of Economics) of the dismal failure of the Comprehensive Agrarian Reform Program (CARP) that is expiring this year. The main conclusion of Dr. Fabella can be summarized in a few words: CARP has only created a new class of people, the landed poor. In short, CARP has failed in its main objective of eradicating poverty in the countryside. In fact, it has made rural poverty worse.
In several investment fora I have attended in the past few months about the bright prospects of the northern Mindanao region (especially what can be referred to as the Metro Cagayan de Oro), I met a good number of investors--both large and small--who are eager to exploit the potentials of a good number of high-value crops in the region. Such investments, however, will be slow to take off unless we listen to the advice of Dr. Fabella about the next stage of agrarian reform. In his concluding remarks he wrote: "For everything there is a season and now is the time to let go. We now have to redirect our agricultural focus from land equity to farm efficiency. More productive farmers should now be allowed to legally own and cultivate ten or more hectares as market efficiency dictates. Corporations registered with the Philippine Stock Exchange and owned by thousands should have no agricultural land ownership ceiling. The transition to individual from collective CLOAS (Certificate of Land Ownership Awards) must be concluded for efficiency. Poverty reduction and empowerment programs for farmers should now take more direct forms such as via CCT (Conditional Cash Transfer). Private capital must be attracted back into agriculture. Banks operating in the rural areas and lending to farmers should be allowed considerable latitude in ownership of agricultural land. Development requires the shift of manpower and resources from the informal to the formal sector. CARP has instead effected a massive de-formalization of agriculture! Time to allow agriculture to march out of the informal into the formal sector."
There is another important reason why we should heed Dr. Fabella's advice and focus on productivity in our land use policy. Starting 2015, our agricultural sector has to be ready for cheaper competing food and animal feed imports from our neighboring countries under the ASEAN Economic Community. In analyzing the future of the coconut industry, in which there is the highest rate of poverty in the countryside, Dr. Rolando Dy gives the following very practical advice: "The future of the coconut farmers lies in the hands of 21st century thinking. If the markets, land and logistics are suitable to high-density hybrid coconuts, so be it. If it is for oil palm or rubber, go for it. If it is cacao, saba banana, and coffee intercropping, then execute the farming systems. The farmer's profit is the acid test. Imagine a Philippines where there is little or no rural poverty. Twenty million people (four million families) earning a total net income of P400 billion a year. It is hard work. But it is possible. Our Southeast Asian neighbors have succeeded in this." I hope our legislators who will have to decide on the fate of the Agrarian Reform law will listen to Dr. Fabella and Dr. Dy. I hope there will be more enlightened members of Congress in both houses who will have the expert agribusiness knowledge of Congressman Pedro Unabia after the elections of 2016. Let us have more farmers and agribusiness entrepreneurs than lawyers in our next Congress! For comments, my email address is email@example.com.