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‘DOE has become a mere announcer of oil price hikes’

“Oil price hikes have direct and lasting effects on agricultural and fishing production cost, cost of farm inputs, and overall cost of living for Filipinos. Throughout the deregulation era, the Department of Energy (DOE) has become a mere announcer of oil price hikes. Deregulation under Duterte also caused much damage to the livelihood and economic status of Filipinos.”Rafael ‘Ka Paeng’ Mariano, Chairman Emeritus, Kilusang Magbubukid ng Pilipinas

The ill logic of rice liberalization

by Rosario Guzman/IBON Foundation

Runaway inflation has always been our economic managers’ alibi for liberalizing importation. Food always takes a beating from this short-sighted policy, as it has the single biggest weight of 36% in the average commodity basket.

Inflation reached its highest in a decade in 2018 upon the implementation of the Tax Reform for Acceleration and Inclusion (TRAIN) Law, the most comprehensive and most regressive tax reform the country has ever had. TRAIN slapped value-added taxes and excises on consumer products, including unprecedentedly on all petroleum products. It reduced income taxes, which have benefited only the rich more than the middle class and the poor, as it has ultimately rebalanced income gains with higher prices.

But it was still the rice’s fault, according to our economic managers, and hastily they did push for the tariffication of the quantitative restrictions on the country’s staple. Rice bears a 9.6% weight on inflation and it is an extremely socially sensitive product on the same level as diesel that TRAIN had finally taxed; thus it has to be kept under control. That is their logic for subjecting local rice to undue competition with imported rice that is far better government protected and supported.

Wrong premises

Our economic managers would later point to decreased rice retail prices, although still higher than pre-tariffication levels, to support the argument that imports liberalization indeed benefits the Filipino consumer.   

It’s turning out to be a feeble argument, however, as the country would again see the highest food inflation in 27 months at the beginning of 2021, with meat and vegetables contributing the most. The apparent cause is government’s non-containment of the African swine fever epidemic in the hog subsector. But despite the obvious need for government intervention in domestic production, the official quick reaction is again liberalization, this time of pork imports.

The government has simply been pitting the welfare of local producers against that of the consumers, apparently in a principle of subordinating the interests of the few (the farmers) to the welfare of the many (the consumers). This is also wrongly premised on the Filipino consumers being concerned only with cheap commodities. Joblessness is at its worst level, while economic aid in the face of the pandemic has been meager. Majority of the Filipino consumers need to be productive first and earn decent incomes, or in the immediate be given economic relief, before they could truly benefit from lower prices. But government’s obsession with imports liberalization has only worsened the jobs crisis, loss of livelihoods, and farmers’ bankruptcy.

Denied reality

From 2018 to 2020, palay prices have gone down by an average of 19.5% for both fancy and other varieties. Palay prices are lower by a minimum of Php3.30 per kilo for other varieties, from a national average of Php20.06 to Php16.76 per kilo. Nine of the 17 regions have even lower palay prices than the national average. These are based on official statistics.

Field studies conducted on the first year of the rice tariffication law by Bantay Bigas, a nationwide network of rice advocates, showed farmgate prices going down to as low as Php10-15 per kilo. Palay prices in the range of Php10-14 per kilo were noted in the country’s rice bowls – Nueva Ecija, Tarlac, Bulacan, Pangasinan, Isabela, Ilocos Sur, Mindoro, Bicol, Negros Occidental, Capiz, and Antique. Palay prices in the range of Php11-15 per kilo were seen in Agusan del Sur, Davao de Oro, Davao del Norte, South Cotabato, North Cotabato, Lanao del Norte, and Caraga. Bantay Bigas noted that palay prices continuously declined in four consecutive cropping seasons right after the passage of the rice tariffication law.

Value of palay production went down from Php385 billion in 2018 to Php318.8 billion in 2020 despite a slight increase of 229,000 metric tons (MT) in production volume at 19.3 million MT in 2020. If the average farmgate price of Php20.06 before rice tariffication was maintained, production value would be more or less at the level of Php387 billion – thus a visible loss of Php68.3 billion in the last two years, or Php32,523 for each rice farmer.

These are based on official figures. Bantay Bigas noted that farmers in Zaragoza, Nueva Ecija lost Php20,000 to Php35,000 per hectare in 2019, as farmgate prices dropped to Php14 per kilo during the dry season and Php10-13 per kilo during the wet season. Farmers in Barangay Carmen in the same municipality have mortgaged about 40% of their rice lands or an estimated 80 hectares due to depressed farmgate prices. In Gabaldon, Nueva Ecija, some rice lands near the highways were already sold at Php1 million per hectare.

In 2019, rice farmers’ net income per hectare decreased by 32% in the dry season, by 47% in the wet season, and by 38% on the average as compared to figures in 2018, according to the Philippine Statistics Authority. This translated to substantially lower profitability ratio for the farmers. For every peso the rice farmer spent on one hectare, his profit declined in 2019 from 73 centavos to 53 centavos in the dry season, from 63 to 36 in the wet season, and on the average from 73 centavos to 47 centavos.

The average net income of Php21,324 in 2019 translated to Php236.93 per day in a 90-day cropping season, down from 2018’s Php34,111 or Php379.01 a day. The farmer lost Php142.08 income per day, which was way bigger than the Php4.65 per day that his family supposedly gained from cheaper rice. (Regular milled rice was reportedly cheaper by Php2.86 per kilo in 2019. The daily average per capita rice consumption is 325.5 grams or 0.3255 kilogram. Thus, 0.3255 kilogram x 5 family members x Php2.86 = Php4.65)

These are official figures. We are not even talking about rice farmers who incurred net losses.

Also incidentally, the Php236.93 income per day recorded in 2019 was short of the already incredibly low official poverty threshold of Php354 per day for a family of five. It was not even enough for the official family food threshold of Php248. The reality is undeniable: the country’s rice producers live in acute poverty and hunger, and rice liberalization is directly responsible for this irony.

The bigger picture

The rice tariffication law purports to offset these losses by allocating the tariff revenues to support farmers. We do not need to go into detail about how these are not enough or at worst tokenistic. We only need to see the trend of government’s agricultural support to conclude that the Duterte administration has put the sector aside in favor of other hollow and counter-productive budget items, including its infrastructure agenda.

The budget for agriculture in 2021 is only Php110.16 billion, merely 2.2% of the national budget. This has diminished further from the 2019 share of 2.7%, which is apparently already the largest under the Duterte administration. Including the budget for agrarian reform, the annual average allocation in 2017-2020 is only 3.6% of the national budget, the lowest in 21 years. This still got smaller at 3.2% in 2021.

The country’s rice self-sufficiency ratio has significantly gone down from 93.4% in 2017 to only 79.8% by 2019. Such increased import dependence is not even justified anymore by the goal of curbing inflation nor by inadequate supply. It is but a formed habit from chronically neglecting domestic production. To illustrate, despite the hyped increase in production volume in 2020 and even at harvest time, the Duterte government approved the importation of 300,000 MT. The pandemic has apparently prompted exporters such as Vietnam and Thailand to prioritize their domestic consumption, triggering already ingrained insecurity among importers such as the Philippines.

Also totally negating the inflation argument now is the fact that Vietnam and China have already started buying rice from India due to increased local prices. This could precipitate another fast rice inflation in the narrow global market, on which the Philippines has unduly relied at the expense of its own direct producers.

This brings us back to the bigger picture – that the farmers’ struggle for the reversal of rice liberalization and for more responsible state intervention is not just about themselves but the more meaningful future of food security and national development. #

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(A contribution to the virtual forum “Rice Tariffication Law: Two Years After” sponsored by the College of Economic Management, University of the Philippines Los Baños, 22 June 2021)

‘Landgrabber’ harasses 14 Bulacan farmers with theft charges–KMP

Fourteen farmers harvesting coconut and banana crops were charged with theft by a private company in Norzagaray, Bulacan, a farmers’ group reported.

In an urgent alert, the Kilusang Magbubukid ng Pilipinas (KMP) said the “landgrabbing” Royal Mollucan Realty Holding Inc. (RMHI) continues its harassment of members of the Samahang Magsasaka sa San Mateo (SAMA-SAMA) and charged the farmers with theft for harvesting their own crops.

RMHI alleged its guards chanced upon the farmers taking coconuts and bananas inside the 75.5-hectare disputed property at Sitio Comra, Barangay San Mateo.

The Office of the Bulacan Provincial Prosecutor recommended a PhP6,000 bail for each of the farmers.

The KMP however said the property the company claims it owns had been placed under a Notice of Coverage under the government’s Comprehensive Agrarian Reform Program (CARP).

RMHI has failed in its legal manoeuvres to have the property exempted from CARP, the KMP added.

The group added that the Court of Appeals has ruled with finality that the land should already be awarded to the members of SAMA-SAMA in accordance with an order from the Office of the President.

“But the Norzagaray Municipal Agrarian Reform Office and the Bulacan Provincial Agrarian Reform Office have been foot-dragging,” KMP said.

Armed personnel of Royal Mollucan Realty Holdings Inc.. (KMP photo)

In its desperation, RMHI had been violent to the farmer-beneficiaries, demolishing their houses, destroying their crops, burned farming equipment, fenced-off agricultural plots and drove away farmers, KMP revealed.

The farmer-beneficiaries have been tilling the property for three decades already, the KMP said. # (Raymund B. Villanueva)

Gov’t priorities enrich a few and destroy the environment–IBON

Instead of just going after local politicians, the Duterte administration should take responsibility for pushing anti-environment policies that contributed to the recent massive flooding and destruction of communities during typhoon Ulysses, research group IBON said.

The National Irrigation Administration and Malacañang recently called out local officials involved in logging and mining. But this will be hypocritical, said the group, if the government does not reverse policies that degrade the environment while benefiting just a few.

The forest cover has fallen to only 7 million hectares as of 2015 according to the Forest Management Bureau. This is equivalent to only 23.3% of the country’s total land area, considered an environmentally critical level. The figure has even continued to diminish from 11 million in the 1970s when forest destruction peaked due to government-sponsored unbridled logging. Data from the Bureau of Soil and Water Management show that 70.5% of the country’s land area is categorized as severely degraded and 16.6% as moderately degraded.

IBON pointed to priorities such as Build Build Build and the National Land Use Plan that continue to encroach into the public domain and degrade land.

The group said that the Duterte government continues to promote large-scale mining, corporate and chemical plantations and land use conversion as well as reclamation for real estate and infrastructure. The government prioritizes the building of large dams, megaports, ecotourism complexes and export enclaves.

Government policies and programs enrich a few at the expense of the nation, the people and environment, IBON said. The group pointed to the businesses of Sy, Villar, Gokongwei, Razon, Ayala, Tan, Caktiong, Ang, and Ty as the biggest gainers from government priorities.

The corporations of these richest Filipinos, according to the latest Forbes’ list, dominate the real estate, construction, ports development, power, energy, water, oil, mining, and agriculture sectors. IBON said that the government should own up to upholding environmentally destructive policies that drive corporate profits instead of pointing fingers at others.

The Philippine government’s bias for profit-seeking interests even at the expense of the environment are the root cause of the logging, quarrying and land conversion in Rizal and Cagayan provinces that have caused such devastating floods. Deforestation, flooding and the sufferings of communities will continue unless these are stopped and corrective measures are taken, said the group. #

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Kodao publishes IBON articles as part of a content-sharing agreement.

Swept away – Philippine agriculture bears wrath from government neglect

by IBON Media & Communications

Government’s long-time neglect of the country’s agriculture sector has been disastrous to small producers. The recent series of super-typhoons – Quinta, Rolly and Ulysses – has highlighted this.

The country’s geophysical characteristics as well as geographic location make it exposed to natural hazards. What makes it extremely vulnerable to risks is government’s lack of relevant policies to strengthen the agriculture sector and the larger economy, including policies and practice of disaster risk reduction and management (DRRM).

Fresh damage

According to a combined bulletin by the Department of Agriculture-Disaster Risk Reduction Management Operations Center (DADRMMOpCen), Quinta left damages to agriculture amounting to Php2.7 billion, with a volume production loss of 149,475 metric tons (MT) in Regions I, II, III, CALABARZON, MIMAROPA, V, VI, and VIII. This affected 57,858 farmers and fisherfolk with 96,474 hectares of agricultural areas.

Still reeling from this devastation, the regions again felt Rolly’s wrath and sustained Php5.79 billion in damages and losses affecting 48,682 farmers and fisherfolk in 127,298 hectares of agricultural areas. The volume of production loss was at 177,091 MT. The National Disaster Risk Reduction Management Council (NDRRMC) further reported that Rolly damaged 170,773 houses and infrastructure worth some Php12.9 billion.

Then, Ulysses happened, leaving 73 dead, 24 injured, and 19 missing in Regions II, CALABARZON, V, and CAR. Damages to agriculture are estimated to be worth Php4.2 billion, to infrastructure some Php6.1 billion, with a total of 67,391 houses partially or totally destroyed. Affected were 102,500 farmers and fisherfolk in 99,660 hectares of agricultural areas. Production loss in commodities including rice, corn, high value crops, fisheries, livestock and poultry, irrigation facilities, and agricultural infrastructures was estimated by the DA to be at 167,385 metric tons (MT).

Some 62,220 hectares planted to rice alone sustained damages and losses amounting to Php1.98 billion with volume of production lost at 124,437 MT. Some 14,132 hectares planted to high variety crops (HVC) areas sustained Php907.7 million worth of damages with volume of production lost at 35,487 MT. As for areas planted to corn, up to 23,308 hectares were affected, with volume of production lost at 7,461 MT amounting to Php371 million. In the fisheries, some Php712 million was lost in terms of affected fin fish, milkfish, hito, tilapia, carp, crabs, and prawns. Livestock and poultry sustained Php51.69 million in damages affecting 72,146 heads. Some Php11.9 million were damaged or lost in terms of irrigation and agriculture facilities.

Quinta and Rolly damages and losses totaled to Php8.46 billion affecting 106,540 farmers and fisherfolk in 223,772 hectares. Volume of production lost reached 326,566 MT. Combined estimates of damages and losses in the Philippine agriculture sector due to typhoons Quinta, Rolly and Ulysses are estimated to have reached some Php12.4 billion to date.

The devastation in agriculture was also grave particularly for Catanduanes province, a top producer of abaca in the country, which is second biggest world producer of the cash crop. According to the Philippine Fiber Development Authority (PhilFIDA), the province accounted for 30% of the country’s annual abaca output. But then Rolly battered Bicol and other abaca-growing regions – CALABARZON, MIMAROPA, and Eastern Visayas, resulting in Php1.2 billion worth of farm damages. The 30% decline in abaca output due to the typhoon as per the estimate of PhilFIDA would land at only 50,000 metric tons (MT) of produce, the crop’s lowest in 20 years. Using PhilFIDA estimates of Php1,000 income for every 10 kilos harvested, this decline is equivalent to a Php2.1 billion loss in farmers’ incomes.

What preparedness?

Government’s DRRM plan, actual implementation, recovery strategy, and even budget allocation of calamity funds are all telling – there is little acknowledgment of the Philippines being a calamity-prone country. It is no basis to say that the country is indeed disaster-prepared.

The Philippines ranks 9th among countries with the highest disaster risk index according to the World Risk Report of 2019. An average of 20 tropical cyclones enter the Philippine area of responsibility annually. Yet the budget allocation for disaster risk reduction in 2020 of Php16 billion declined from the already meager Php20 billion or 0.5% share in the 2019 national budget. The NDRRMC is again set to get Php20 billion in lump sum calamity funds in the 2021 national budget. But it remains a mere 0.4% of the total budget.

Components of the National Disaster Risk Reduction and Management Plan (NDRRMP) 2011-2028 are: disaster prevention and mitigation, disaster preparedness, disaster response, and disaster recovery and rehabilitation. This should mean building massive evacuation and shelter infrastructure, for instance. This should also mean making available competent education, health, and housing, and providing sufficient energy, water, communication and transport mechanisms that can withstand any weather hazard. For a largely agricultural country, it should also mean the availability of crop insurance, food stocks, production support at all times, whether or not during recovery, and other measures that ensure farmers, fisherfolk, and farmworkers’ continued sustenance when calamities strike. Neither the NDRRM Plan nor the DARRMOpCen explicitly mandate these as part of the mitigation and preparedness steps of DRRM.

The NDRRMC reported Php115 million worth of assistance provided to Ulysses victims. The DA assured Php400 million in Quick Response Funds and Php300 million worth of emergency loans with zero interest and no collateral, payable in 10 years under the Survival and Recovery (SURE) Loan Program of Agricultural Credit Policy Council (ACPC) for farmers and fishers affected by Quinta and Rolly. The agency has also assigned the Philippine Crop Insurance Corporation (PCIC) to provide insurance protection to farmers against losses arising from various calamities. Those insured under the PCIC are set to receive Php10,000-15,000 in insurance claims for damaged farm equipment, fishing boats, and gear. But this measure is premium-dependent and ties impoverished farm producers to indebtedness.

PCIC coverage is quite limited and leaves millions of agricultural producers behind. PIDS explains that the amount of cover is based on the cost of production inputs specified in the farm plan and budget submitted by the farmer upon application of insurance. Insurance premium rates vary based on the type of insurance cover, risk classification, type of farmer, and type of insurance cover availed. Premium for high value crop insurance is solely shouldered by the farmers, ranging from 2-7% of the total sum ensured. Premium rates for fisheries are solely determined by the PCIC.

According to latest available Philippine Statistics Authority (PSA) and PCIC 2018 figures cited by the Philippine Institute for Development Studies, only 2.2 million farmers in 1.8 million hectares are insured. This is a small number compared to the over 10.9 million farmers, farmworkers and fisherfolk in the government’s Registry System for Basic Sectors in Agriculture or RSBSA. It was also noted that while a huge chunk or 1.1 million of listed farm parcels reported by the Census of Agriculture and Fisheries (CAF) were less than 0.5 hectare in size, the penetration rate of the PCIC in these holdings was quite low compared to parcels of bigger sizes.

Long-time neglect of agriculture

Even given the backdrop of being a natural hazard-prone nation, government action for the farming and fisheries sectors has long-been either too little or too detrimental. Weather disturbances have even gotten worse over the years due to climate change, increasing further havoc on the country’s agriculture communities.

Philippine agriculture is in crisis, growing at an average 2.1% in 2017-2019, its slowest pace after 70 years of growing at 3.5% annually on the average. In the same period the sector lost over one million jobs. In the third quarter of this year, the sector grew only by 1.2%.

In 2018, the country’s agricultural trade deficit was the largest in history, and in 2019 the Philippines began importing its staple food rice.

However, despite the sector’s decline and disaster vulnerability, the budget for agriculture and agrarian reform averaged just a measly 3.6% of the total national budget annually from 2017-2019. This has been reduced further to 1.7% in 2020 and 1.6% for 2021 under the Duterte administration.

Calamity-battered Bicol

An example of the vulnerability and crisis of the country’s agriculture is the Bicol region. The region is prone to natural calamities such as typhoons, volcanic eruptions, drought and flooding, almost on a yearly basis. It is among the areas whose agriculture sector was hard-hit by the recent consecutive typhoons. The several calamities that have torn through the region in recent years resulted in billions of pesos in agricultural damage.

These include, for instance, tropical depression Usman which left Php1.6 billion worth of agricultural damages in Bicol at the end of 2018. Typhoon Tisoy, which hit the country in early December 2019, resulted in over Php1.7 billion worth of agricultural damages in the region, affecting its major crops. Bicol’s agriculture has also suffered crop losses from the El Niño drought last year and its abaca sector’s battle with the Abaca Bunchy Top Disease.

The region’s agriculture sector is now reeling from damages wrought by Quinta (Php395.8 million), Rolly (Php3.6 billion), and Ulysses (Php168.5 million).

Bicol’s abaca and coconut industries have not yet recovered from the havoc wreaked by Typhoon Tisoy. In the second quarter of the year, coconut production and abaca production both registered negative growth rates of 8 and 4 percent, respectively, from the same period last year.

Build Back Better” vs. inclusive response

The region’s disaster risk reduction bodies undertook early warning measures such as preemptive evacuation and advanced harvesting during typhoons Usman and Tisoy. In a way, mitigation was leveled-up. Yet, the Bicol Region’s agriculture sector, as with the rest of the country’s, was left vulnerable to destruction. The DADRROpCen practices the integration of DRR measures in the plans of government agencies. But like the NDRRMC plan, it is weightier on response, relief and recovery rather than building the core capacity of the agriculture sector. Making it flourish and able to stand on its own is not part of the plan.

The bottomline of the Philippines’ disaster risk reduction plan is the global-inspired “Build Back Better” which has been used in various calamities worldwide but saw big contractors and businesses taking the upper hand in rehabilitation and recovery. This is instead of focusing on really strengthening communities per se in terms of ensured rights to basic needs including food and jobs, adequate standards of living, a balanced ecology, ample services and development. These would be what will forge the capacity to withstand disasters.

In the case of agriculture, policies destroy rather than hone the sector’s own contribution to building this capacity. Decades of subscribing to global market dictates have crippled the agriculture sector and reduced it to being a supplier of cash crops, now being enhanced by the Plant, Plant Plant program. The National Land Use Act will accelerate the conversion of agricultural lands into commercial ones. Rice import liberalization meanwhile is destroying farmers’ incomes with falling palay prices and results in the shutdown of mills.

Through these policies, the government pushes Philippine agriculture off the cliff and keeps our farmers poor and vulnerable to calamities. Government lacks the sense of urgency to aid the calamity-stricken agricultural producers and only promises some farm inputs and limited financial assistance, not to mention in the form of burdensome loans. This jives with its non-interest to develop the sector other than for what the global market needs it to be.

The only way the country can really be disaster-prepared would be if risk reduction and response followed a comprehensive plan across pre-calamity and calamity scenarios. This needs to start with strengthening the heart of the economy and that is Philippine agriculture and manufacturing. Agriculture programs from the most token to those that destroy the industry and Filipino producers’ livelihoods must be stricken out especially liberalization and commercialized and profit-oriented insurance and credit-facilitation.

Land should be free for the tillers and not converted to non-agricultural use; the decision on how to make it productive theirs; give them substantial farm subsidies and direct farm facilities, machine and inputs support; and ensure their social protection. Especially during a pandemic such as the one that grips the nation and the world now, sustained financial assistance and direct support for producers is very much in order.

Governance that decides to sovereignly boost agriculture this way will be the same one that will forge policies and infrastructure for domestic industry, a healthy environment, people’s rights, and funding development, which are certain foundations of people-centered disaster preparedness. #

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Kodao publishes IBON articles as part of a content-sharing agreement.

Filipino rice farmers need support, not liberalization

by IBON Media & Communications

In a statement, National Economic and Development Authority (NEDA) acting secretary Karl Kendrick Chua said: “The Philippines generally does not have a natural comparative advantage in rice production compared with neighbors like Thailand, Vietnam and Myanmar which all have large flat plains, fewer or no typhoons, less history of land inequality, and access to the Mekong River system, which serves as a great source of natural irrigation, as well as lower population growth rates.”

On that basis, NEDA argues that rice liberalization is the logical thing to do and that the Rice Liberalization Law (RLL, or Republic Act 11203) is already benefiting the country. The problem with this argument is that it treats food security like a game that you lose just because you do not have the right starting conditions. That’s a free market-based argument that only has a semblance of sense in economics textbooks.

In the real world, and as proven by the experience of literally every successful developed economy, comparative advantage can and should be modified with government intervention. Chua omits how government neglect and policies like the Rice Liberalization Law (RLL) are what undermine Philippine rice production and domestic agriculture. The Philippines can improve productivity, increase production, and provide enough rice for Filipinos with sufficient government support to rice farmers and the rice sector. The government’s defeatist attitude and blind surrender to market forces is the biggest reason why Philippine rice production and domestic agriculture as a whole remains so backward.

The RLL is captive to that narrow-minded thinking and just makes things worse.

Misplaced praise

NEDA hails the Rice Competitive Enhancement Fund (RCEF), a component of the RLL, which supposedly guarantees Php60 billion pesos from rice importation revenues for six years. RCEF will supposedly help rice farmers to modernize and innovate. This seems to be helping rice farmers.

Instead, RLL is killing the rice industry. Over a year into RLL and because of unrestrained rice importation, palay prices have fallen to as low as Php8-10 per kilo. This is a huge 50% drop from the Php20 per kilo price of palay before the law was passed. Rice farmers have cumulatively lost some Php84.8 billion in earnings in the first full year of implementation or around Php35,328 per rice farmer. Earnings are not enough to pay for the cost of production.

As a result, farmers from Philippine rice granaries such as Isabela, Nueva Ecija, Laguna and Mindanao are already thinking to stop planting rice. At least 3,000 rice mills have already stopped operating.

Farmers were facing worse prospects for selling palay even before the RLL. The government earlier clipped the powers of the National Food Authority (NFA) to influence and support the price of rice in the market by restricting the amount of palay and rice it buys locally .

RCEF claims to enhance farmers’ competitiveness through mechanization, seeds distribution and trainings. However, its coverage is actually limited and can even aggravates farmers’ indebtedness.

RCEF reportedly aims to cover 1.9 million rice farmers listed in the Registry System for Basic Sectors in Agriculture (RSBSA) and Department of Agriculture (DA)-accredited rice cooperatives and associations. This still leaves out at least half a million rice farmers. The Integrated Rural Development Foundation (IRDF) has for instance already estimated that the annual Php10 billion RCEF allocation will not be enough to offset the losses that RLL causes rice farmers, which it computes to be between Php60-Php110 billion.

Loans may also just worsen indebtedness if productivity or earnings do not increase much and if farmers’ expenses are still too high. Loans are too easily eaten up by production costs such as for expensive commercial seeds, fertilizers, pesticides and tools. The government does not make any effort to make these more affordable. Landless farmers may just end up using loans to pay their land rent to landlords.

These are why so many government loan programs have just kept so many farmers in a cycle of debt. The Agricultural Competitiveness Enhancement Fund (ACEF) and the Sugar Industry Development Act (SIDA) also provide rural credit. RCEF and the older ACEF and SIDA reportedly make Php2.1 billion in funds available for easy credit to rice farmers. About Php2.5 billion of ACEF funds were allegedly lost to corruption in 2014. Meanwhile, stakeholders lament that SIDA funds reportedly amounting to some Php2 billion per year since 2015 have so far been underutilized.

Worsening neglect

NEDA’s negativity about the country’s rice industry glosses over the government’s accountability for the agriculture sector’s backwardness because of its long-standing neglect. Government policies on land and food such as the RLL, relying on imported agricultural products, allowing rampant land use conversion, and flawed land reform only worsen the impact of this neglect.

The agriculture sector shed over one million jobs between 2017 to 2019 which is the most jobs lost in a 3-year period in 21 years. The sector’s 2.1% average annual growth in the same period was below its 3.5% average annual growth for 70 years from 1947-2016. Agriculture’s share in gross domestic product (GDP) has fallen to its smallest in Philippine history at 7.8 percent. The agricultural trade deficit in 2018 was also the largest in the country’s history at US$8 billion.

Agriculture is still such a significant part of the economy and these signs of weakness point to how much needs to be done to bolster the sector. And yet, under the Duterte administration, the budget for agriculture and agrarian reform averaged just a measly 3.6% of the total national budget annually from 2017 to 2019. This is even slashed further to just 1.6% in 2021. This means that the government’s capacity to support farmers with facilities, subsidies and other assistance is declining.

Rice farming households are also among those who will not be getting any more cash assistance. Although agricultural production was among the least affected sectors by the pandemic, earnings from rice farming are so poor that many rural families also rely on various odd-jobs in the informal sector which have been adversely affected. Yet the proposed 2021 budget for cash assistance has been reduced to just Php9.9 billion from over Php260 billion under the emergency Bayanihan 1 and Bayanihan 2 laws.

Support our producers

The Philippines’ annual average rice self-sufficiency ratio over the last 30 years was 91% and the country was 93% rice self-sufficient as of 2017. Yet rice can be much cheaper and the country can be fully self-sufficient if only there was enough support, subsidies and facilities for the country’s 2.4 million rice farmers. We do not have to import our staple food and rice farmers can have decent incomes.

Why do we have to risk not having rice on the table from rice-exporting countries stopping exports to make sure that they have enough to feed their own people? How sure are we that the price of rice will remain stable if domestic production remains backward and global rice prices are volatile?

Why make our farmers suffer? Along with other producers, they provide the nation with food to eat, yet they are among the poorest.

The government is liberalizing the critical rice sector out of blind adherence to so-called free market and globalization policies. All this does is create opportunities for giant agribusiness corporations to make even more profits from selling their expensive, chemical-laden, unhealthy, and environmentally-destructive products.

Filipino farmers have to deal with so many man-made woes aside from the vagaries of the weather. Yet they are not passive to these. Farming communities nationwide practice sustainable agriculture. These should be recognized and supported. Indigenous peoples’ schools teach organic agriculture and oppose corporate encroachment on their lands. These should be hailed not vilified or shut down.

Peasant organizations struggle for their own land to till. They deserve to be given these as well as given the means to make these productive. Precarious rural incomes and livelihoods should become a thing of the past. And, as every Filipino deserves, farming communities should have decent education, health and housing as well as the conveniences of water, electricity, telecommunications and transport. In all of these, the government’s role in running an economy for the people is the most important intervention of all. #

Fighting for our rights to food, a healthy environment and development

by Xandra Liza C. Bisenio

In a forum on the role of consumers in agroecology, Commission on Human Rights (CHR) Economic Social and Cultural Rights (ESCR) Center Assistant Chief Klarise Espinosa stressed that the right to food is recognized in the International Covenant on Economic, Social and Cultural Rights (ICESCR).

Article 11 states that “everyone has a right to an adequate standard of living… including adequate food, clothing and housing, and to the continuous improvement of living conditions.” As duty bearers, governments are expected to make sure that the right to food and the factors enabling it are realized, clarified Espinosa. The ESCR Center is currently reviewing to what extent the Philippine government facilitates and provides sustainable, available, and accessible food.

The ICESCR underscores that the right to food is linked to having decent living standards and the availability of essential needs, services and utilities for an individual and families. For campaigners of People Economics, asserting the right to food is inextricably connected to the people’s struggle to realize their rights to produce food and other basic needs, to industrialization, to a nurtured environment, to the comprehensive range of working people’s rights, to progressive fiscal systems, and to economic sovereignty.

Right to food challenged

In the Philippines, the government gives only token attention to the right to food, as well to the rights to an adequate standard of living, services such as health and education, and even to utilities such as water and electricity. Neoliberal policies have also kept the economy backward and underdeveloped, thus leaving the environment in bad shape, and affecting the availability of safe and sufficient food.

The Philippine government’s food threshold is very low and set at a measly Php50 per person per day. But the Philippines should not have to be counted among the top countries with moderate to severe food insecurity and high levels of malnutrition as per the food and Agriculture Organization (FAO) had the government not abandoned and liberalized agriculture, IBON Research Head Rosario Guzman said.

The critical state of our natural food sources, namely Philippine agriculture and the environment, is due to government neglect and mispriorities. This helps to explain why Filipinos’ access to safe and sufficient food is problematic.

The agriculture sector, which produces our food, lost 1.4 million jobs from 2017 to 2019, or even before the pandemic. The sector’s annual growth was only at 2.1% on average in the same period and its share in the economy has reached its smallest in Philippine history at 7.8% of gross domestic product (GDP) in 2019. Combined agriculture and agrarian reform budgets were at their lowest in 21 years being only 3.6% on the average also from 2017-2019.

In the middle of the pandemic, government even defunded agriculture further with a meager 1.5% allocation in the 2021 budget. This pales in comparison with the agriculture budgets of rice-exporters Vietnam, Thailand, and Indonesia, which are at 6.3%, 3.6%, and 3.3% of their national budgets, respectively.

Land degradation and land use conversion have also disrupted the ecological balance and affected food systems.

The country’s forest cover is now down to only 23.3% of the country’s land area which, according to environment scientists, is ecologically unhealthy. They say that the country’s geography and terrain should sustain a 54% forest cover.

The use of inorganic chemicals and input-dependent crop varieties meanwhile has caused severe erosion in 70.5% of the country’s land area. Moreover, land conversion for corporate agriculture, cash crops, real estate and infrastructure has also added to ecological disruption. The current administration is for instance pushing for almost one million hectares of oil palm plantations in Mindanao. Its Build, Build, Build infrastructure projects, including the Kaliwa, Kanan, and Laiban Dams, threaten to destroy communities, livelihoods, farms, forests, and water sources.

IBON infographic

Hunger and government’s unsustainable ways

Philippine agriculture is in contradiction as a food system, affirms Dr. Charito Medina of the Magsasaka at Siyentipiko para sa Pag-unlad ng Agrikultura (MASIPAG). Farmers and fisherfolk producing food, he says, struggle to eat, and are the poorest sectors with 36% and 34% poverty incidence, respectively, according to official 2018 poverty statistics. Land planted to food kills instead of extending life because it is heavily infused with chemicals. Agricultural lands produce not for people but for big business in the case of feeds and biofuels production. Food wastage is high. Ultimately, corporations, not farmers, control and profit from agriculture. Government policies even prioritize importation and cash crops for export instead of strengthening local food production.

Rural, urban, and indigenous folk affirm how government policies have made food more difficult to both produce and avail. Zen Soriano of the Amihan National Federation of Peasant Women (Amihan) said that during COVID, farming communities are practically being hamletted during the lockdown. This makes it difficult for farmers to transport their produce and for farmworkers to transfer from one planting area to another. There are even cases when peasant missions to deliver food aid were terrorist-tagged. She also said that the rice liberalization law has caused palay prices to fall and millers to close down.

Mimi Doringo of the urban poor group Kalipunan ng Damayang Mahihirap (Kadamay) meanwhile said that for families whose breadwinners lost their jobs or are in precarious work amid the coronavirus crisis, more expensive food and services make it more difficult to cope. Kakay Tolentino of the BAI Indigenous Women’s Network agreed that many government policies have interfered with indigenous people’s food systems in ancestral lands, from the commercialization of palay seeds to destructive mining, export crop plantations, ecotourism projects, and militarization.

These are happening while the pandemic crisis batters especially millions of the poorest and informal workers. The widespread distress is driving calls for heightened aid, food security programs benefiting all marginalized sectors, junking rice liberalization, and a halt to corporate landgrabbing and the commercialization of land and crops. Strategically, the calls are for land reform so that tillers can make their land productive and benefit from this, and for a healthy and robust environment that is not being maimed in pursuit of so-called development that only benefits a few.

Call to consumers

As rights holders, consumers can establish solidarity with producers and themselves begin sustainable practices in producing and consuming food. They can demand the production of and access to safe and sufficient food. Consumers need to also thwart the corporate onslaught on agriculture. Consumers can assert not only the right to food but the right to produce it, and other economic, social and cultural rights.

Solidarity with producers can range from forming relationships to directly procure local farmers’ produce and help raise farmers’ incomes, to standing with farmers in their campaigns for land and life. While maintaining this connection with local producers, consumers can also engage in urban farming to grow what they eat and eat what they grow.

In demanding the production of and access to safe and sufficient food, consumers can call out government neglect of the country’s own production sectors. They can push for ample budget allocation to agriculture and industry, free land distribution and stopping land use conversion, and boosting local production by giving farmers financial and infrastructure support. They can push government to procure local produce and to ensure local stocks for adequate supply.

Consumers can demand that the price of food be reasonable. They can demand subsidies in times of crises and emergencies such as during the COVID-19 pandemic. There are so many households, displaced workers, farms and small businesses in need.

The corporate onslaught on agriculture and on Filipino producers and consumers also has to be thwarted for local production systems to break free from big business and foreign profit-driven objectives. This means saying no not only to the highly chemical and artificial farm inputs detrimental to the soil and the people’s health, but also to all policies that prevent Philippine agriculture from flourishing into the nation’s giver of food and material for development. This means saying yes to Filipinos’ indigenous, traditional ways of farming, while improving food and agricultural programs towards being ecologically sound, scientific and sustainable conduits of progress. #

* “The Role of Consumers in Agroecology” was co-organized by the Samahan at Ugnayan ng mga Konsyumer para sa Ikauunlad ng Bayan (SUKI), Magsasaka at Siyentipiko para sa Pag-unlad ng Agrikultura (MASIPAG), IBON, and the AgroecologyX Network

Why can’t food self-sufficiency be our new normal?

by Rosario Guzman

From the outset of the Duterte government’s military lockdown as its response to the spread of the coronavirus, it has directed the continuous flow of food commodities, along with medicines and other essentials. Food is inarguably essential to people’s survival during a pandemic and in its socioeconomic aftermath.

Government’s response however has fallen short in ensuring food production and supply. In fact, the military and authorities have controlled even the movements of the direct producers, both in tending their farms and selling their produce to the markets. Even activist volunteers who endeavored to bridge the farmers’ produce to urban consumers and to deliver relief goods to the farming families were detained and accused of violating quarantine rules and inciting to sedition.

The thing is, government has erased “food self-sufficiency” from its agricultural planning principles, now totally unheard of in the Philippine Development Plan 2017-2022. It has instead focused on “economic opportunities” anchored on “market orientation”. The country’s lack of food self-sufficiency has made government’s coping with crises such as COVID-19 utterly chaotic.  It is the economy’s sinkhole that will make us fall deeper into a COVID-aggravated economic crisis.

Yet, eight weeks into the military lockdown, while it continues to wrestle with its insufficient health response, the Duterte government is talking of a “new normal” in agriculture. A closer look at the plan, however, reveals it to be a bunch of old habits that have hampered Philippine agriculture from achieving even the most basic goal of food security, much more self-sufficiency.

Pre-COVID crisis

Only eight weeks ago, the country’s “normal” agriculture was having its worst crisis in decades. The sector lost 1.4 million jobs in 2017-2019, the highest number in a three-year period in the last two decades. Its average annual growth rate of 2.1% in the same period is also lower than the 3.5% average in the last 70 years. The sector has also reached its smallest share in history at just 7.8% of the country’s gross domestic product.

In the first quarter of 2020, agriculture posted a 1.2% decline in output, finally collapsing after a momentary recovery from a decline in 2016 and a three-year slowdown thereafter.

Neoliberal policies that government has recklessly implemented are the culprit in agriculture’s near demise. Starting off with the evasion of free land distribution to tillers and rampant land conversions to favor finance capital, government has oriented agriculture towards commercialization, high value cash crops, inorganic chemicals dependency, paid-for irrigation, imported machinery, and trade liberalization. Agriculture is not a government priority, which is putting it mildly when the figures clearly manifest state neglect. The 3.5% average share of agriculture and agrarian reform in the 2017-2020 budgets is the lowest in two decades. In 2018, the Duterte administration delivered the coup de grace with the liberalization of rice imports.

Landowners and merchants have exploited this “normal” – that is the classic story why our food frontliners are the most destitute and hungry in Philippine society. And like adding insult to injury, the government points to farmers’ lack of capacity and technology (and interest to carry on) as the reason why food self-sufficiency is not feasible.

Government gross neglect

Then, COVID-19 happened. Government agencies could not even provide a full picture of our food buffer stocks. The Philippine Statistics Authority has stopped updating the rice inventory, for instance. This showed that, as of March 1, our rice stocks were enough for only 65 days, quite below the 90-day buffer. Vietnam’s announcement that it would implement a rice export ban added to Filipinos’ anxieties – Vietnam accounts for about 38% of Philippine rice imports.

A day before the declaration of a lockdown, euphemized as ‘enhanced community quarantine’ (ECQ), the Department of Agriculture (DA) made assurances that there was enough food for everyone in Metro Manila. The stocks of rice, vegetables and root crops, poultry and meat products, fish, and eggs were sufficient. It took time before some local government units started distributing relief foods, and even then mostly unhealthy canned sardines.

Farming has been disrupted. IBON estimates about 2.5 million farmers, farm workers and fisherfolk economically dislocated by the ECQ. The ECQ guidelines specifically allow establishments engaged in food production and trade but are painfully quiet about the farmers. Farmers’ organizations have said it succinctly – there is no work from home for them. They are subsistence farmers who will go hungry if they are not allowed to farm.

The Duterte government’s COVID response for agriculture under the Bayanihan to Heal as One Act is to provide Php5,000 cash assistance each to only 591,246 beneficiaries under the Financial Subsidy to Rice Farmers (FSRF). But as of 28 April 2020, seven weeks into the lockdown, the Duterte government has served only 266,284 rice farmers.

Farming families may have been given cash assistance through the social amelioration program of the Department of Social Welfare and Development (DSWD), which even then has only served 57% of its target 18 million beneficiaries as of 1 May 2020.

Granting that the rice farmers have indeed received subsidies, IBON estimates these to be equivalent to only Php80-119 per day over 49 days of lockdown, or less than one-fourth of the already low official poverty line of Php353 per day for a family of five.

Government’s meager and much-delayed response to the pandemic is pushing the poor and vulnerable farmers and fisherfolk deeper into poverty and hunger, which gets more and more morally unacceptable at this point in our crisis.

Photo by Lito Ocampo

Neoliberal inertia

The DA is among the first agencies to talk of a new normal. We should rethink and restructure our policies and practices, said DA secretary William Dar. But the DA’s emphasis on the continuation of neoliberalism especially under a global economy that is about to plunge into a grave depression cannot be missed. The Duterte government cannot fake a new normal narrative when its transition plan remains neoliberal.

The budget priority for the DA to transition to its “new normal” remains for cash assistance instead of production support. This is under the Rice Farmers Financial Assistance (RFFA), which is in line with the implementation of the Duterte administration’s rice liberalization law. The RFFA targets to provide Php5,000 to rice farmers who are tilling 0.5-2 hectares. The FSRF is in addition to RFFA and is packaged as the COVID-19 response, which targets rice farmers who are tilling one hectare and below. The total target beneficiaries of both packages are 1.2 million rice farmers nationwide, but there are 2.5 million rice farmers in the country who are definitely dislocated by rice liberalization.

The program priority is a food resiliency action plan that is aimed at an unhampered flow of food and agri-fishery products. It is anchored on the aforementioned cash assistance as consumption stimulus and market links such as the Kadiwa program, market satellites and market on wheels. In short, it is anchored on trade, again not so much on strengthening farmers’ production. The plan is also about popularizing urban and backyard gardening, which is overly focusing on individual consumers to go on survival mode instead of improving the production and conditions of farming communities in the real spirit of bayanihan.

The DA has proposed to implement nationwide the “Ahon Lahat, Pagkaing Sapat (ALPAS) Laban sa Covid-19” or what it dubs as Plant, Plant, Plant program to “increase the country’s food adequacy level”, with an approved Php31-billion supplemental budget. But this will be done by intensifying the use of quality seeds, inputs, modern technologies – which have been proven from experience to only add to the farmers’ debt burdens. The DA unfortunately has perennially acted as a marketing agent and endorsed the sale of seeds, inputs and farm machinery of big agribusiness to Filipino farmers, while it has shunned the promotion of agroecological practices.

The Duterte government still emphasizes that in order for agri-fishery to grow and cope with emergencies such as pandemics, the sector needs to attract more investments and resources and partner with the private sector. And there we are back on the neoliberal road.

Photo by RB Villanueva

Build the momentum

Surely, food self-sufficiency can be our new normal. But first in the face of a pandemic, farmers need fast and sufficient relief assistance, both for their daily needs and health services and as production subsidy. In the same manner that urban consumers should be relieved of paying their bills during COVID-19, farmers should have been long ago condoned of their mounting debts from unpayable land amortizations, loans from unscrupulous traders, and even from availing of government lending programs. Then, farmers and fisherfolk should be allowed to go to their farms and on fishing trips and deliver their produce to the markets.

But in the long-term, food self-sufficiency is about the assertion of an entire range of human rights. The state should recognize the right to food, the right to produce food, the right to till the land, and to have control of the land that farmers have been tilling for generations. Farmers have the right to choose their own production system, so as not to be dictated by the whims of the market and made vulnerable to market vagaries. We can envision an agriculture that is moving away from the profit-oriented concept of value chain that disregards the small producers and their environment, and move towards sustainable farming practices.

In the end, we can build the momentum for food self-sufficiency only from the farmers’ struggle and movement for genuine agrarian reform. And that should be our new normal. #

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Kodao publishes IBON articles as part of a content-sharing agreement.

Farmers lose Php85 billion during first year: Peasant livelihoods destroyed, food insecurity worsened by rice liberalization

by IBON Media

Research group IBON said that rice liberalization has undermined the livelihoods of millions of farmers and most likely even pushed many into bankruptcy. It will only worsen the country’s food insecurity, the group said, as already seen with record high rice imports.

Enacted one year ago, the Rice Liberalization Law or Republic Act (RA) 11203 removed quantitative restrictions on rice importation and replaced this with 35% tariff on rice imports from the region and higher from elsewhere. The law was justified as the solution to high rice prices in 2018. Tariffs from the rice imports were also supposed to fund programs to make Filipino rice farmers competitive, eventually increasing their incomes.

IBON said however that the influx of record rice imports has devastated farmers’ livelihoods. The Philippines imported a record 3.2 million metric tons (MMT) of rice in 2019, surpassing the previous record of 2.4 MMT of rice imports in 2008 by 40 percent. That was the first time that the Philippines gained the dubious distinction of being the world’s biggest rice importer.

Huge rice imports caused palay farmgate prices to plummet, said IBON. The price of palay fell by 22.4% from Php20.14 per kilogram (/kg) in end-December 2018 to Php15.63/kg in the same period in 2019, said the group. Some major rice producing provinces such as Nueva Ecija, Isabela, and Laguna even reported palay prices as low as Php7/kg and Php10/kg.

IBON estimates that rice farmers in aggregate suffered a total income loss of Php84.8 billion in 2019 due to the catastrophic drop in palay farmgate prices. This is equivalent to an average income loss of some Php35,328 per rice farmer.

Farmers groups have reported that as many as 200,000 farmers were forced to stop planting rice due to income losses. Also, at least 3,000 of the country’s some 10,000 rice mills reportedly closed down due to the increase in rice imports.

IBON said that the widespread disruption of rice producers is intentional and the result of free market forces being unleashed on the country’s backward agriculture. The group assailed the economic managers for using high rice prices to justify pushing marginal and so-called unproductive farmers and millers into bankruptcy.

IBON said that the country’s food insecurity is getting worse under the Duterte administration especially because of the low government priority given to domestic agriculture including the rice industry. The country’s rice importation grew from the equivalent of around 5% of total rice production in 2016 at the start of the Duterte administration to 26% of total rice production in 2019. Unprecedented rice imports are exposing the country’s inability to produce sufficient quantities of its staple food, said the group.

IBON said that the rice liberalization policy is another indication of government’s long-time neglect and disregard of local rice production and agriculture in general. The group said that the government should not pit rice farmers and rice consumers against each other. Farmers and consumers have a common interest in the protection and strengthening of the domestic rice industry towards rice self-sufficiency. #

Real Duterte Legacy: Agri crisis belies admin claims of econ success

by IBON Media

Research group IBON said that the crisis in Philippine agriculture due to government negligence contradicts claimed economic achievements under the Duterte Legacy Campaign. The group said that the administration’s neglect and prioritization of local and foreign big business interests is worsening an already weak and struggling sector.

IBON said signs of this agriculture crisis include slowing sectoral growth; shrinking share in gross domestic product; rising import dependence; increasing trade deficit; significant job losses; and widespread rural poverty.

The Philippine Statistics Authority (PSA) reported a minimal 0.4% growth in agriculture in the fourth quarter of 2019. Under the administration, year-on-year growth trend in agriculture has been declining. From a contraction of 1.2% in 2016, agriculture bounced back with a 4% growth in 2017. But this was short-lived when growth fell to 0.9% in 2018 with a slight increase to 1.5% in 2019, noted the group.

IBON said that agriculture’s share in gross domestic product (GDP) has been declining from 8.8% in 2016 to 8.5% in 2017, 8.1% in 2018, and 7.8% in 2019. This is a far cry from its over 40% share in the economy in the 1960s.

While the country has been increasingly dependent on food and agricultural imports in the past couple of decades, this has further heightened under the Duterte administration, the group said. For instance, the country’s consumption of garlic imports was only 1.1% in 1990, but this surged to 91% in 2018.  Rice import dependency ratio (IDR) meanwhile decreased from 9% in 1990 to 5% in 2016. But this grew to 13.8% in 2018 and could worsen with the increase in rice imports due to the Rice Liberalization Law.

IBON noted that as much as 1.4 million jobs were lost in agriculture, with employment falling from 11.1 million in 2016 to 9.7 million in 2019. This translates to an average annual job loss of 455,000 in this period.

Another indicator of agriculture in crisis is widespread rural poverty, said IBON. Poverty incidence among farmers (34.3%) and fisherfolk (34%) is higher than the national average (21.6%), according to latest available figures. However, IBON estimates that at least 90% of farmers and fisherfolk are impoverished, if based on more reasonable standards of poverty measurement.

IBON said that despite its worsening state, the agriculture sector remains low priority for the administration. The 3.5% share of agriculture in the 2020 budget is the lowest since 2004 at 3.3 percent. The group also noted that annual average share of agriculture in the national budget from 2017 to 2020 was just 3.6% – the lowest since the Ramos administration (3.5%).

IBON said that agriculture, hand in hand with domestic manufacturing, is an important productive sector that, if supported and strengthened towards public interest, could help boost and sustain genuine development and job creation. The administration’s continued neglect of the sector and advancement of harmful pro-big business policies that are destroying local production and farmers’ livelihoods only shows how fake the Duterte Legacy really is, the group said. #