The agriculture sector could see growth accelerate if farmers abandon rice and shift to growing high-value crops, a Cabinet official claimed on Wednesday.
“A growth of maybe 3-4 percent is possible for the sector if we focus on high-value crops and just import rice,” Budget Secretary Benjamin Diokno told reporters, adding that trade should also be liberalized as much as possible to realize the industry’s potentials.
“That is the most efficient economic arrangement. And as I said, you always have to think of what’s the greatest good for the farmers,” he said.
The Budget chief underscored the importance of rice tariffication — a proposed law is just waiting for President Rodrigo Duterte’s signature — and the planned deregularization of sugar imports.
“You have to put pressure on the sector to improve themselves, increase productivity because right now they are not competitive,” he said, noting in particular that the cost of producing rice was much higher than world prices of the staple.
Agriculture, Diokno pointed out, expanded by just 0.8 percent in 2018 and contributed a measly 0.1 percentage point to full-year gross domestic product growth of 6.2 percent.
“Simply put, the farm sector had virtually zero contribution to economic growth last year,” he said.
Agriculture Secretary Emmanuel Piñol, meanwhile, urged the government to implement intervention programs to protect farmers against a surge in imports.
Amid Diokno’s call for a shift from rice farming, the Agriculture chief said productivity could be improved via the use of the proposed P10-billion Competitiveness Enhancement Fund.
“If the interventions will be given right away and our farmers will be given enough time to make use of those interventions to improve their productivity, yes, our farmers could compete,” he said.
“But if we immediately implement liberalization even before the interventions could reach our farmers and even before they could improve their productivity, it could lead to the death of the rice industry,” Piñol added.