6–7% economic growth needed for RP to end hunger

IF the country is to end hunger, a goal that has been elusive for years, the Philippines must post a long-term sustained economic growth of at least 6 percent to 7 percent, according to the Washington-based think tank International Food Policy Research Institute (Ifpri).

In an interview with the BusinessMirror, Ifpri Director General Shenggen Fan said the very low economic growth is one of the biggest reasons the country is not likely to achieve the Millennium Development Goal (MDG) target of halving poverty by 2015.

“Obviously, the higher the better, right? But I think if you have sustained long-term growth of GDP at 6 [or] 7 percent per year [that will be enough]. The Philippines has not had such a growth. All countries are moving up, the Philippines is [stagnant],” said Fan.

“So overall lack of economic growth, lack of agriculture growth, lack of social protection are the major reasons for the Philippines not reaching MDG [Goal] 1. Compared to other countries in the region [like] Indonesia, Vietnam and China, growth in the Philippines has been lacking, it is slow. There’s not enough growth, overall growth.”  

One of the ways by which the country can help increase growth is by increasing its investment in agriculture. “For many countries, successful countries, they usually allocate at least 10 percent of their national budget to agriculture. In the Philippines, it’s only 4 percent. It’s very far away from 10 percent” or around P154 billion of its 2010 P1.54-trillion national budget.

Last year former President Arroyo approved a budget of P40.8 billion for the agriculture sector for 2010—P39.2 billion for the Department of Agriculture (DA) and P1.6 billion for DA-owned and -controlled corporations.

These investments in agriculture should be spent on agricultural research, rural infrastructure, extension services, and efforts to increase the participation of the private sector in the agriculture sector.

Further, Fan said in developing the Medium-Term Philippine Development Plan 2010 to 2016, one of the most important policies to include is increased support for small holders and small farmers.

These entrepreneurs, Fan said, need to be linked to markets and to trade and trade facilities. He said the Philippines has a lot of potential when it comes to trade but this has significantly been reduced in recent years.

 Fan said, however, there is a chance for this to be revived and the key is to empower small holders and farmers. With that, the country can again export a multitude of agriculture products that will not only increase exports but also make farming lucrative to farmers and the private sector. –Cai U. Ordinario / Reporter, Businessmirror