Foreign investors should lease, not buy, idle lands for large farming projects
The government is urged to allow foreign investors to own food factories, port sites, and nursery lands in the country to generate more jobs and raise the Philippine agriculture productivity, which is the lowest in the region.
Economist Rolando T. Dy, executive director of the Center for Food and Agri Business of the University of Asia and the Pacific Professor School of Management, said foreign investments are necessary to complement domestic investments in large tracks agricultural projects.
Dy, however, said that foreign investors should not be allowed to own large tracks of farmlands.
Instead, foreign investors should enter into long term finance deals for idle public and private lands to produce rubber, timber, coffee, cacao, fruit trees, oil palm.
He said foreign investments are needed to augment domestic capital for global market intelligence and managerial skills to create sustainable jobs.
According to Dy, 40 percent of people in the rural areas are poor with P300 daily income per family. He estimated that 20 million of the 26 million poor Filipinos are in the rural areas.
World Bank data also showed the rural poverty in other ASEAN countries are much lower – Thailand 13.9 percent, Indonesia 13.8 percent, Vietnam 17.4 percent, and Malaysia 8.4 percent.
The high poverty is due to the very low productivity of the agriculture and fishery, where majority of the poor population depended on.
A United States Department of Agriculture study shows that over the last 50 years, the total productivity of Philippine agriculture is last in the ASEAN.
During 1961-2012, the Philippines’ total agriculture productivity grew by only 1.19 percent a year versus Malaysia’s 2.64 percent, Vietnam’s 1.67 percent, Thailand’s 1.36 percent, Indonesia’s 1.32 percent, and Myanmar’s 1.67 percent and China’s 2.23 percent.
Agriculture remains a big sector. It employs some 30 percent of the labor force ( about 11 million) but only accounts for only 10 percent of gross domestic product.