Secretary William Dar of the Department of Agriculture;
Representatives from the farmers’ groups, private sector, civil society, academe, think tanks, and those who are working for the betterment of farmers and fisher folk in the Philippines;
Ladies and gentlemen;
It’s a distinct honor for me and the World Bank to be launching this morning, in partnership with the Department of Agriculture, the report titled “Transforming Philippine Agriculture During COVID-19 and Beyond”. And more so with the presence of Secretary Dar, the architect of the country’s New Thinking in Agriculture, and many other distinguished guests, panelists and participants today.
This report draws inspiration from the vision laid out by Secretary Dar. It provides a candid assessment of the challenges the Philippine agriculture sector faces. It finally brings in lessons from extensive international experience to highlight options for policy, public spending, institutional reforms, and investments to speed up the modernization of the farming sector.
The Philippines’ agriculture sector has shown some resilience in the face of COVID-19. Despite the difficulties brought about by the pandemic, the agriculture and fisheries sector grew by 1.6 percent in the second quarter of the year. It’s the only sector to grow during the period.
This reflects timely actions to ensure that farmers have access to farm inputs and services and efforts to avoid major supply disruptions and keeping the transport of agricultural products and food open. More than just a buffer, agriculture can clearly play an important role in the economic recovery of the Philippines as it works to gain back the ground it lost during the pandemic.
Going forward, the World Bank will continue to support reforms to boost competitiveness, diversification and climate resilience. These will help raise incomes in rural areas, support economic recovery from COVID and accelerate productivity growth and the transformation of the economy.
I won’t preempt my colleague’s presentation about this report but allow me to highlight a few messages.
Modernizing the country’s agricultural sector is a very important agenda for the Philippines. Precisely, transforming Philippine agriculture into a dynamic, high-growth sector is essential to poverty reduction, inclusive growth and getting to the next level income and development. With the exception of a few natural resource-rich countries, no country has successfully transitioned from middle- to high-income status without having achieved an effective transformation of their agri-food systems..
Echoing the vision laid out by the government’s “New Thinking for Agriculture,” the report suggests an important paradigm shift, away from a heavy focus on specific crops towards improving the overall competitiveness, resilience, and sustainability of the sector. This shift typically leads to more diversified sectors with stronger food value chains, affordable and nutritious food, and a vibrant rural economy.
Second, how you spend fiscal resources matters. Every peso spent has an opportunity cost. Therefore, spending the peso where the impact on productivity is the largest is critical. While public ensuring the availability of key inputs and machines remains important, some rebalancing of public spending towards more investments in public goods, including research and development (R&D), infrastructure, innovation systems, market information systems, or biosecurity systems, will further improve productivity and the sector’s overall modernization and performance.
The report provides detailed recommendations on various topics to support ag transformation. My colleague will come to that in the Presentation. Let’s admit that transforming the country’s agriculture and food systems will be a formidable challenge. But the New Thinking for Agriculture vision is compelling. The current thrust for diversification and use of modern technologies are pertinent. The management of food supply during this pandemic and reforms in rice trade that lowered food prices for all Filipinos also augur well. The country is very well-equipped to overcome the challenge.
I look forward to hearing the thoughts of our distinguished panelists as well as the other participants, so let me stop here.
I am sure we’ll all leave this event inspired and energized. Thank you for your kind attention.
Download the Full Report: Transforming Philippine Agriculture during COVID-19 and beyond