Industrialization of agri sector needed: ex-DA chief

By Lilybeth Ison

October 4, 2017, 11:26 pm

MANILA -- The Philippines must accelerate modernization and industrialization in the agricultural sector to cope with globalization.

This was the statement Wednesday made by former Agriculture Secretary William Dar in his closing remarks at the culmination of the ASEAN Agriculture Summit held at the SMX Convention Center in Pasay City.

“(There’s a need) to accelerate modernization and industrialization of the country’s agriculture sector anchored on an entrepreneurial ecosystem, which should also involve actively and systematically most if not all smallholder farmers in the Philippines,” said Dar, who was also former director general of International Crops Research Institute for the Semi-Arid Tropics (ICRISAT).

“The issues that are worthwhile addressing as we modernize and industrialize the country’s agriculture sector should include increasing level of productivity right at the farms, which could be addressed by investing heavily or doing massive technology transfer, mentoring and training of farmers for adoption and commercialization, and even financial literary or how to handle money wisely,” he noted.

A country with a thriving agriculture sector and agro-industries, he added, has lesser poverty, citing Thailand’s rural poverty incidence of 13.9 percent and national poverty incidence of 10.5 percent.

He said Indonesia's poverty incidence is 14.2 percent in the rural areas and 11.3 percent at the national level while, Vietnam has an 18.6 percent poverty incidence at the rural level and 13.5 percent at the national level.

As compared to these ASEAN neighbors, he said, the Philippines has a poverty incidence of 30 percent in the rural areas and 21.6 percent at the national level.

When it comes to farm exports, the Philippines only has two major farm export commodities – banana and coconut – that earn more than USD1-billion each every year, while Thailand boasts of rice, natural rubber, prepared fish, sugar, prepared chicken, starch, prepared shrimp, animal feed and food preparations as its top farm exports that each rake in at least USD1 billion annually.

On the other hand, Vietnam’s exports that earn more than USD1 billion every year include rice, coffee beans, shrimps, fish fillet, cashew nuts, natural rubber, prepared shrimp and pepper.

“If the Philippines can diversify more to high-value crops and other commodities that have export potential either in processed or raw form, we can definitely improve the country’s total factor productivity for its farming sector hence more export earnings,” Dar added.

“So the challenge here for us is to also produce enough to supply the domestic market with more competitively-priced and quality farm products in both raw and processed form,” he said.

Low productivity at the farm level, he said, can also be addressed through consolidation or forming blocs or clusters of production to achieve economies of scale.

“When small parcels of farmlands are consolidated, farmers can organize themselves into producers organization and or cooperatives that can acquire farm machineries and access credit,” he added.

Dar said it is also important for government institutions “to make affordable credit accessible to cooperatives and smallholder farmers, and to offer schemes so they can acquire farm machines, either through affordable credit or a reasonable level of subsidy.”

Farmer cooperatives can also be trained to become providers of mechanized farm services like land preparation, planting and harvesting, both for their members and non-members.

“The formula for inclusive growth through agripreneurship is simple — high productivity at the farm level; manufacturing or processing by agro-industrial firms and cooperatives; and tapping both the local and export markets,” he added.

The ASEAN Agriculture Summit is an initiative of the ASEAN Business Advisory Council (ABAC) as its first step forward to bring together and mobilize key ecosystem stakeholders into crafting and actualizing an integrated framework for agripreneurship that is integral to achieving prosperity for all.

The summit focuses on informing, inspiring and connecting ASEAN agri ecosystem stakeholders toward adopting and supporting the modernization and industrialization of agriculture thru agripreneurship as a sustainable strategy to alleviate poverty, accelerate growth, and promote rural development throughout the region. (PNA)