POSTSCRIPT / January 23, 2007 / Tuesday


Philippine STAR Columnist

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Yap sees aggie sector booming in 2007-08

BOOM YEARS: Despite the poor showing of agriculture in the 4th quarter of last year — pulling down the overall performance of the economy — Agriculture Secretary Arthur Yap is brimming with optimism that 2007, as well as 2008, will be “boom years.”

He says agriculture, or food production in general, will surge this year because the government will pour huge outlays into it and several giant foreign investments in farming are coming. (Besides, next year’s election spending will stimulate the market.)

Yap’s positive outlook is not his alone. The last-quarter survey of the Social Weather Stations had shown that nine out of every 10 Filipinos believe they have much to hope for in 2007.

The 4 th quarter SWS survey revealed that the “level of hopefulness” among Filipinos rose to 91 percent from 85 percent in 1985. The middle to upper (ABC) classes topped the hopefulness level with 92 percent, while Class D (the masa ) and Class E (poorest of the poor) responded with 91 percent.

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HELPING THE POOR: Yap says that the government, through his department, is working round the clock and pumping more millions into farming to make sure the upbeat mood among Filipinos is not misplaced.

To directly benefit low-income folk, the DA will step up such programs as the Gulayan ng Masa, Manukan para sa Masa, Isdaan para sa Masa, and the Barangay Food Terminal projects benefiting an initial 400,000 poor families.

The Gulayan project providing backyard-raised vegetables to the jobless has benefited 13,669 families so far, or 78 percent of the 17,000 family targeted for the July-December period.

Thus far, 9,878 families were able to harvest vegetables from their backyards, indicating a 48 percent accomplishment rate. This Gulayan project is eyeing 207,403 beneficiary-households in 2007.

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RESOLVE: Barangay Food Terminal outlets, meanwhile, are helping 118,697 families. They are expected to benefit another 556,591 once all the planned additional outlets are set up this year.

Yap says the Manukan project, a source of chicken meat and eggs, and the Isdaan using catfish (hito) for food and income aim to cover over 130,000 families this year.

The 3.88-percent growth of agriculture last year, despite the typhoons that ravaged the country in the last four months, reflects the resolve of Yap to make this sector lead growth and create jobs.

Some analysts, btw, have dismissed this 3.88-percent growth as “lower than expected” for a sector that accounts for a fifth of the economy.

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4TH QUARTER DROP: But looking at data in perspective, we see that the 3.88-percent growth, versus a 4-percent target, was actually higher than the 2.31 percent performance in 2005.

Comparing previous years, the agriculture sector grew 5.23 percent in 2004, 3.51 percent in 2003, 3.81 percent in 2002, and 4.46 percent in 2001.

Before the country was ravaged by typhoons late last year, agricultural growth targets were being met, with the first quarter figure at 3.91 percent, the second quarter a high of 6.6 percent, and the third quarter at 4.22 percent.

The strong performance of agriculture in the first three quarters was a result in large part of the DA’s programs using hybrid and high-quality seeds and its expanding the planting areas.

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SUPERTYPHOONS: The sad story was that the farm sector’s fourth quarter growth dropped to 1.64 percent after supertyphoons Milenyo, Queenie, Paeng, Reming and Seniang devastated wide areas during the September-December period.

The damage to farmlands was actually minimal owing to the early planting encouraged by the DA, but the fisheries subsector, which was the top gainer last year, was badly hit.

Fisheries posted a performance of 4.93 percent in the 1 st quarter and 11.24 percent in the 2 nd quarter. But its growth in the 3 rd up to the 4 th quarters sagged to 5.77 percent and 3.48 percent, respectively, after typhoons damaged fish pens and slowed down commercial fishing.

Despite the typhoons, aquaculture still grew by 11 percent in 2006. Municipal fisheries expanded by 10 percent as a result of coastal resource management by the Bureau of Fisheries and Aquatic Resources.

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UPBEAT NOTE: But Yap says that agriculture’s “lower-than-expected-growth” in 2006 is not likely to do a repeat this year. On the contrary, he vows that “2007 will be an investment year” for his department and the farming sector.

He says the DA will intensify its initiatives to boost farm and fisheries production and raise rural incomes to achieve a conservative 4 percent-5 percent expansion target in 2007, followed by a higher forecast of 7-8-percent growth for 2008.

His upbeat forecasts for 2007 and 2008 are anchored on the administration’s commitment to funnel more investments into rural infrastructure and productivity programs this year.

In terms of infrastructure, Yap points out that the government will go on massive public spending this year, allocating P3 billion to repair and rehabilitate irrigation facilities nationwide.

Foreign investments are also coming in, he says, topped by 19 projects of Chinese investors bringing in, according to media reports, some P240 billion.

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SINO PROJECTS: His growth forecasts assume congressional approval of the national budget, which provides for a higher allocation of almost P20 billion for agriculture, from about P15 billion last year.

Actual performance will be affected by the possible resurgence of the El Nino dry spell and other adverse weather conditions that may adversely affect farm production.

But aside from the increase in government spending for farming and food production, Yap is banking on the 17 memorandums of agreement covering agribusiness ventures signed during the recent two-day state visit of Chinese Premiere Wen Jia Bao.

Two more MOAs covering another 200,000 hectares are set for signing this year, bringing to 1.2 million hectares the total area coverage of 19 Chinese agribusiness projects in 2007. Both are with the Beidahung Heilongjiang Group, China’s biggest agriculture investor.

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DEALS SIGNED: One the 17 investment deals sealed during Premiere Wen’s visit allows the Fu Hua Co. of China to invest $3.83 billion (30 billion RMB) in one million hectares of land in the Philippines for the cultivation of hybrid rice, corn and sorghum.

Another agreement calls for setting up four bio-ethanol plants by the Nanning Yongkai Industry Group with local companies. They require the planting of sugarcane in an additional 40,000 hectares (at 10,000 hectares per ethanol plant) to provide feedstock.

Many of these projects were worked out by a Yap-led investment mission that went to China last November in a followup to the visit to that country by President Gloria Arroyo.

These projects involve mobile ice plants and transport facilities for fishery cooperatives and associations, the breeding and raising of grouper and other high-value fish, the building of a shipyard, establishment of a cold storage and the rehabilitation of the Navotas Fish Port Complex, the cultivation of an initial 40,000 hectares for cassava and sugar for ethanol production for China’s consumption, and the development of the Candaba swamp as a source of irrigation and potable water.

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RICE IMPORTS: Reuters reports, meanwhile, that the Philippine government has just bought 474,000 tons of rice from Vietnamese firms for delivery between February and April.

Administrator Jessup Navarro of the National Food Authority was quoted by Reuters as saying that the government will also buy 20,000 tons of rice from Thailand and 6,000 tons from Pakistan.

Malacanang was earlier reported to be setting aside P4 billion to import a huge quantity of rice this year. The importation means the polls will go on as scheduled this May.

It cannot be ascertained immediately, however, if the massive importation is intended to cover a shortage, to stabilize grains prices, to boost the profits of friendly rice merchants, or to help poor voters.

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(First published in the Philippine STAR of January 23, 2007)

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