GOVERNMENT earmarked P26.54 billion for lending to farmers and agribusiness entrepreneurs, but the Department of Agriculture (DA) also needs the private sector’s help "to move this money where this is most needed."
Potential rural borrowers need innovative lending schemes to counter the financing system’s view that farmers and fishers are high-risk clients, DA Undersecretary Jesus Emmanuel Paras said at an economic briefing held Wednesday at Marco Polo Hotel in Cebu.
The bulk of the funds, about P23 billion, will be coursed through banks, viable non-government organizations and cooperatives. For the One Town One Product program, the Development Bank of the Philippines can move up to P2 billion, while cooperatives and rural banks are programmed to get P2.5 billion for lending.
Paras tagged the lack of rural credit as one of four reasons behind “underin-vestment” in agriculture. The other three are an unpredictable investment environment that stems from the lack of land tenure, vulnerability to the weather, and the lack of research and development that will answer the agriculture and fisheries market’s needs.
"Our major challenge is to attain a yearly average growth of four to 5.2 percent in the next three years that can be felt by our rural folk in terms of better living standards," Paras said in his presentation.
Declining output
In Central Visayas, agriculture and fisheries contributed 10.68 percent of the region’s gross domestic product (GDP). That year, however, the sector’s output declined by 3.9 percent from its 2005 levels. The regional economy’s engine relies heavily on trade, which accounted for 33.5 percent of GRDP in 2006, and manufacturing (21.09 percent).
While the region’s industrial sector grew higher than the national average from 2004-2006, its growth rates for agriculture remained lower than the national trend, said Regional Director Marlene Rodriguez of the National Economic Development Authority in a separate presentation.
But the sector needs to grow to ensure affordable food prices, provide good farm incomes, make economic growth sustainable and broad-based, and improve the quality of life, Paras said.
At four percent, agriculture’s average growth from 2004 to 2007 fell slightly below the target (4.1 to 5.1 percent) set in the Medium-Term Philippine Development Plan (MTPDP).
Fisheries grew fastest among the sectors, at 6.81 percent over 2006 levels, followed by crops at 5.57 percent. Livestock posted a modest growth at 2.38 percent, while poultry plodded along at 0.31 percent.
Drought during an El Niño spell in 2005 was part of the reason agriculture failed to meet its MTPDP targets in 2005-2006, said Paras. A series of eight typhoons, including Milenyo and Seniang in 2006, hindered recovery efforts. IDA
