AGRICULTURE AND THE

ECONOMY

FEDERICO O. PEREZ, Ph.D.

Professor in
Soils and Environmental Science
Philippine Agriculture
Agriculture including forestry and fishery plays a dominant
role in our economy
70% of the population is predominantly rural
2/3 of the population depends on farming
of labor force is engaged in agricultural activities
Phil agriculture consisted of rice, corn, coconut, sugarcane,
banana, mango, livestock, poultry, and fishery production
Agri contribution is about 11% of GDP
Average growth rate is 3.2% but now declining
Land utilization
LAND USE HECTARES (M) PERCENT
Arable lands 4.39 39.45
Crops mixed with 3.74 33.66
coconuts
Coconut 1.13 10.17
Crops mixed with other 0.36 3.28
plantations
Fishponds 0.19 1.75
Other plantations 0.09 0.82
Other fishponds 0.01 0.09
Grasslands 1.29 10.78
TOTAL 11.134 100.00
Phil Agri contd.
50% of GDP is attributed to crops
Rice 20%
Corn 6%
Banana -5%
Coconut 4%
Sugarcane 2%
Mango 2%
Pineapple 2%
Others 9%
Phil. Statistics Authority
Phil Agri contd.
Other 50% of GDP is attributed to the following:
Fishery 19%
Livestock 13%
Poultry 11%
Activities and Services 7%

Phil. Statistics Authority

Phil Agri contd.
Low performance of agri is due to the following:
Inadequate resources
Limited implementing capabilities of the national and
LGUs
Weak coordination among implementing agencies
Occurrence of natural disasters (El Nino, La Nina,
typhoons-600,000 tons of milled rice is being lost,
floods, etc.) Ranks 7th among nations of about 180
International crisis (high fuel prices)
Lack of financial capital of farmers
Low adoption of technology
Global Competitiveness of Agri Products
Export Competitive Crops
Coconut oil/Palm oil
Cavendish banana/Banana chips
Mango
Pineapple
Durian and mangosteen
Abaca
Cacao
Rubber
Global Competitiveness of Agri Products

Import Substitute Crops

Rice
Yellow Corn
Potato
Cassava
Vegetables
Tomato
Cutflowers
Global Competitiveness of Agri Products
Export Potential of Livestock and Poultry
Pork
Chicken
Beef
Major Concerns of Livestock and Poultry Raisers
High feed costs
Country is not an FMD-free zone
High cost of producing yellow corn
Global Competitiveness of Agri Products

Fisheries Products as Export Winners

Seaweeds
Carageenan
Shrimps/Prawns
Tuna
Deboned milkfish
Tilapia (emerging export)
Agriculture and Poverty
Agricultural productivity growth contributes to better
nutrition through raising incomes especially in
countries where the sector accounts for a large share
of the economy and employment and by reducing the
cost of food for all consumers (FAO)
Achieving food security means not just ensuring that
sufficient food is produced but also that everyone
has access to it- and failures of access to food
particularly the most marginal communities are
largely hidden from the public view (UNESCAP)
Agriculture and Poverty contd.
Poverty encompasses different dimensions of
deprivation that relate to human capabilities including
consumption and food security, health, education,
rights, voice, security, dignity, and decent work
(OECD)
According to SWS survey, 41% of Filipino households
(8.8M households, about 45M Filipinos) claim to be
food-poor.
15.5M Filipinos are undernourished
Food Inadequacy
COUNTRY 2010-2012
PHILIPPINES 23.80
Brunei Darussalam <5
Cambodia 27.10
Indonesia 15.80
Lao PDR 38.30
Malaysia 6.90
Myanmar (Burma) 29.50
Thailand 15.50
Timor Leste 46.10

Source: FAO
What do these data tell us?
According to FAO, economic growth alone will not solve
food insecurity, it must be paired with the ff:
Income growth
Direct nutrition intervention
Investment in health, water, education
Rice self-sufficiency can be achieved by ensuring that
the food producers have access and aware of the
means on how to improve their farming (IRRI)
Economic Performance

In 2013, the GDP growth is 7.2%

In 2015, the GDP growth is 6.9%, the highest in
Asia followed by China which is 6.4%
Annual budget:
2016 PhP3.1T (Aquino Admin)
2017 PhP3.35T (Dutertes proposal)
Major Concerns of Phil Agric

Increased production to sustain the food needs of

the growing population (food security)
Employment generation to meet the government
agenda
Greater global competitiveness
Agricultural land use conversion
Problems of accelerated soil erosion, siltation of
irrigation systems, intense flooding and water
pollution
Land Use Conversion
1970 -1980 20,000has were converted every year
1987 1991 11, 337 has were converted
2000 -2005 estimated conversion is 100,000 has

Nueva Ecija Land Use Conversion:

1998 80 has/year (according to Perez, FO)
 Effects of agricultural practices and farming systems in the environment
FARMING SYSTEM PRACTICE PROBLEMS ADDRESSED IMPACTS
Mechanization Labor inefficiency Soil erosion, energy dependency, labor
reduction

Intensive use of inorganic Low crop yield Soil and water pollution, pests, GW
fertilizer contamination

Indiscriminate use of chemical Crop loss to pests New and resistance to pests, pollution,
pesticides poisoning, chemical dependency

Planting of hybrids and GMOs Low crop yield Aggravated pests problems, chemical
dependency, loss of local adaptations,
high input expenses

Reduction of fallow periods Low production Accelerated soil erosion, loss of fertility

Cultivation of marginal areas Inadequacy of land Deforestation, erosion, sedimentation,

biodiversity loss