Large farms with high-value crops, scholarships ‘will outperform Carp’

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Friday, August 24, 2012


IF there’s one thing that hinders the agriculture sector from growing, it is the country’s agrarian reform program, the chairman of a research and consultancy firm said.

Peter Wallace, chairman of the Wallace Business Forum, said a one percent growth in agriculture is “very low” for a country that grows its population at a higher rate.

Wallace was one of two main speakers at the finance and economic forum sponsored by the Financial Executives of the Philippines (Finex)-Cebu Thursday. He was tasked to speak on the key sectors that will sustain the country’s growth. One of the key sectors he mentioned was agri-business.

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While he found the Comprehensive Agrarian Reform Program (Carp) an “emotional idea”, Wallace said it failed to promote the growth of agriculture.

“The economics of scale is needed to achieve growth. You cannot do that with just five hectares,” he explained.

He noted that in other countries such as his own Australia, farms prosper because these are run on large tracts of land. “This is big-scale stuff.”

Instead of giving land to farmers that they cannot sell or use as collateral to get a loan from the bank, he suggested a program that would provide a small piece of land, a decent home and schooling for a farmer’s family while he worked in a plantation that could produce high-value crops.

Wallace added that the Carp makes it hard for small-scale farmers to acquire technology, which would improve their yield if they had it.

He cited products like coffee, dairy, organic and halal crops as some products that the country could produce and be successful in.

Wallace identified agriculture as one of the key sectors needed to achieve inclusive growth for the country. He lauded the current administration’s efforts to make the country rice-source sufficient, saying these efforts helped the agriculture sector get back on its feet.

Aside from agriculture, he also echoed a study of the Asian Development Bank (ADB) noting a lack of manufacturing plants in the country.

While the economy may have grown due to the services sector, Wallace noted that jobs available for this sector require those who have been better educated, mostly those with a college background.

With more manufacturing plants, he said those with little education will have more job opportunities to better support their families.

Other key industries that he identified for Cebu are in IT-BPO, shipbuilding, electronics, green technology, creative industries, synthetic resins, rubber, tourism and fabricated metals.

Wallace advises multi-national and Filipino companies on a “balanced assessment” of conditions, forecasts and what can be expected in the Philippines.

Published in the Sun.Star Cebu newspaper on August 25, 2012.

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