Overview of Agricultural Development in the Philippines

Current State of Agriculture

• Agriculture is not the major economic driver it once was, but it remains crucial for overall economic progress.
• In 2018, the poor population in the Philippines was about 17%, but 32% of farmers and 26% of fisher folk were still classified as poor.
• Approximately 25% of the workforce was employed in agriculture as of April 2020, yet this sector only contributed 9% to the GDP, highlighting low productivity in agriculture compared to industry and services.
• Local farms are vital for food security, producing the majority of staple foods:
  • Self-sufficient in cassava, sweet potato, milkfish, and tilapia.
  • Over 90% of rice and corn consumed is locally produced.
  • 80-90% of meat consumed is also produced locally.

Historical Context and Trends

• Philippine agriculture thrived during the 1960s and 70s, aided by technology and agribusiness investments, especially in crops like sugarcane, bananas, and pineapples.
• Growth slowed in the 1980s, recovered in the 90s and early 2000s, but declined again in the 2010s.
• Poultry has seen above-average growth, while traditional crops have stagnated due to a lack of diversification.
  • Dominance of five crops: rice, corn, coconut, sugar cane, and bananas.
  • High-value crops (e.g., soy, cacao) remain underrepresented.
• Fisheries output has declined since 2013 due to overfishing and environmental challenges.
• The livestock sector has been impacted by the African swine fever outbreak.

Comparison with Southeast Asian Neighbors

• Philippine agricultural exports lag behind those of Vietnam, Indonesia, and Thailand:
  • 1997: Philippines: $2.3B, Vietnam: $3B, Indonesia: $8B, Thailand: $13B.
  • 2017: Philippines: $7B; Vietnam: $30B; Indonesia and Thailand: $30-40B.

Government Spending and Infrastructure

• Government spending on agriculture in 2018 was 143 billion pesos (9% of agricultural output), increasing to 247 billion in 2020 but yielding limited tangible outcomes in agricultural advancement.
• Philippines ranks 60th out of 160 countries in the World Bank's Logistics Performance Index as of 2019, indicating infrastructure challenges.

Farm Size and Fragmentation

• Average farm size shrank to 1.29 hectares by 2012, limiting farmer income potential.

Opportunities for Improvement

• Sagipsaca Act (RA 11321) promotes farmer and fisherfolk enterprises, aiming for consolidation and partnerships with the private sector.
• New Thinking Paradigms: 8 paradigms promoted by the Department of Agriculture (DA) include:
  1. Modernization with technology.
  2. Industrialization of agribusiness.
  3. Consolidation for economies of scale.
  4. Infrastructure development.
  5. Strategic roadmaps.
  6. Budget for public sector priorities.
  7. Legislative support for policy reforms.
  8. Cooperatives as a critical role in agricultural development.

Role of Cooperatives and E-commerce

• Cooperatives can facilitate economies of scale, promote modern technologies, and foster partnerships for agribusiness transformation.
• E-commerce is becoming more prevalent in agriculture, providing opportunities for farmers and fisherfolk through digital platforms and collaboration with the private sector.

Conclusion

• The new paradigms and the focus on cooperative engagement present an opportunity to revitalize agricultural development in the Philippines.