WB says RP farm policy deepens poverty
MANILA, Philippines - Misguided farming policies, including land reform, are keeping millions in the Philippines poor, according to a report released by the World Bank this week.
The report said only the manufacturing and service sectors, which require huge capital and skilled workers, had grown significantly over the last decade while agriculture, which employs most of the non-skilled, faltered.
"These productivity trends reflect a growing scarcity of land and a progressive reduction in the amount of land per worker, aggravated by agrarian reform policies," the World Bank said.
The Philippines passed a land reform law in 1987 to break up large agricultural estates owned mostly by the ruling elite and give land to millions of farmhands.
Last year parliament extended the program by five years amid widespread landlord opposition, which has kept a number of big corporate farms intact, including one controlled by the family of President Benigno Aquino.
The World Bank urged the government, among others, to set up a commission to review its current agrarian reform policy so farm land is not tied up and can be used more freely as capital.
The government says one in three people in the country of 95 million are poor, with most living in rural areas. The farm sector employed 32.5 million people in April, the latest official data available.
Productivity among Philippine farms has stagnated over 30 years due to falling investment in public infrastructure such as irrigation, as well as reduced farm sizes owing to rapid population growth, the report said.
"This decline in farm size has been intensified by agrarian reforms that have negatively affected the functioning of land markets and made access to land more difficult for small-scale farmers," it added.
The report said other policies over the period brought only short-term relief to select groups though not necessarily the rural poor.
Efforts by the Philippines, now the world's largest rice importer, to grow all of its needs merely stifled the efficient allocation of resources and hindered families from earning incomes from other farm activities, it said.
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Philippines Poor
Philippines will remain poor with leaders who don't have vision to make Philippines develop and progress. Philippines has no products to sale and market around the world. Only cheap labor! Unless Philippines starts industries the like of Japan, Korea and China, Philippines will not become a first world. Poor Pinas can only export Pinay for cheap labor!
Government Not Really Serious
No government had really put the most thrust in agriculture than ex-dictator Marcos. The country export a bit of excess rice for a short while, a good indication. Department of Agriculture is just like other ineffective government department, just waiting for their small allocation of budget, mostly to pay staff and nothing for infrastructure at all. You give them extra money for so called projects, and would turn up as ghost one such as the fertilizer scam. What else would come up to this so called DA? This is one of the countries lousiest department. It should be at the foreffront considering that many are dependent on agriculture, but sadly it is a failed department, like most of the government bodies.
It's time to change dramatically, otherwise, people would have no recourse but to chaos after chaos, as they the agriculture sector becomes poorer and poorer.
Wake up, wake up, wake up!
Please give priority to our agricultural sector....
Accounting for Sources of Growth
The Philippines’ growth record during the
past four decades leaves much to be desired when
compared with the high growth performance of its
East and Southeast Asian neighbors. What have
been the key drivers of and reasons behind its slow
and erratic growth?
On the supply side, the three major sectors
(agriculture, industry, and services) grew steadily
during the 1950s, 1960s, and 1970s . But
the economic crises in the mid-1980s, early 1990s,
and late 1990s slowed growth considerably. During
the recession in the early 1980s, industry was the
hardest hit as the growth rate for the period slipped
to 0.6% from a high 7.9% in the previous decade.
Industry recovered in the 1990s and stabilized in the
2000s, but services proved to be the main contributor
to growth starting in the 1980s. In the 1990s,
agriculture contributed 12.9% to GDP growth;
industry, 35.3%; and services, 51.9%. During
2001–2006, agriculture’s average contribution to
GDP growth increased to 15.9%; that of industry
decreased to about 22.6%, while that of services
increased to almost 61.5%.
This depicts the output share of the major
sectors. Agriculture, including fishery and forestry,
was a major source of income and employment from
the 1950s to 1980s. In 1986, agriculture’s share of
real GDP was about 25%. In 2006, this had declined
to about 19%. The biggest subsector in agriculture is
crops and, during 1986–2006, its share of real GDP
fell from 23.0% to 18.6%. Forestry’s share declined
from 1.7% in 1986 to 0.1% in 2006, reflecting the
rapid rate of deforestation that had taken place.
In the course of economic development, the
share of agriculture to real GDP is expected to
decline. Industry is normally expected to pick up
the slack. This did not happen in the Philippines.
The share of industry was highest in the 1960s
and 1970s as import substitution policies, which
were oriented mainly toward the domestic market,
extended high rates of effective protection to local
industries against imports. In the 1980s, industry’s
share began to decline. In 1986, industry’s share to
real GDP was 35%; in 2006, the share had dropped
to 32.5%. The biggest subsector in industry is
manufacturing. In 1986, manufacturing’s share of
real GDP was 24.7%; this fell to 24% in 2006. Food
processing is the most important manufacturing
subsector.