Agrarian Reform in a

Globalizing World
Three Propositions
1. Liberalization amidst declining public and
private investments in agriculture undermines
the economic viability of small agricultural
stakeholders and the of the sector itself;
2. Implementing a comprehensive agrarian
reform program is essential if agriculture is to
survive in this globalizing world
3. There are certain institutional, policy as well
as resource requirements that must be met in
order to deliver an effective agrarian reform
program
Outline of the Presentation
1. Overview of Philippine agriculture
2. Arguments for agrarian reform
3. Requirements for an effective agrarian
reform progam
Share of agriculture to total
economic output is declining
Share of agriculture to GDP, 1980-2008

30.00

25.00

20.00

15.00 Share of agriculture to GDP

10.00

5.00

-
1980 1984 1988 1992 1996 2000 2004 2008
Share of agriculture to total
employment has also been declining
Share of Agriculture to Total Employment, 1990-2008

50.00

45.00

40.00
35.00
in per

30.00
Share of Agriculture to Total
25.00
Employment
20.00

15.00

10.00

5.00

0.00
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
Average labor productivity in
agricuture is low
Average Labor Productivity per Sector, 2005

171,900
Total

191,075
Services

348,633

Industry

68,674
Agriculture

0 50,000 100,000 150,000 200,000 250,000 300,000 350,000

Php per year
Only 1.5 of the country 3.1 million irrigable
lands have irrigation facilities
Number of irrigated and irrigable lands in the Philippines,
1990-2008

3.5

3.0
1.7 1.6
1.9 1.8 1.8 1.7 1.6
1.8 1.7 1.7
(in million hectares)

2.5 1.7
1.6 1.7 1.7 1.7
1.8 1.8 1.8 1.8
2.0

1.5

1.0
1.6 1.5 1.4 1.5
1.3 1.3 1.3 1.4 1.4 1.4
1.6 1.5
0.5 1.3 1.3 1.3 1.4 1.4
1.4 1.4

0.0
1990 1992 1994 1996 1998 2000 2002 2004 2006 2008
Irrigate lands for Irrigation
Lack of access to affordable credit
The percentage share of agricultural production
loans to total loans has drastically dropped
from 6.99 per cent in 1990 to only 0.94 per
cent in 2006.

Source: Bureau of Agricultural Statistics

Limited budget for agriculture
Agriculture Budget as a Percentage of Total Budget Under
Different Administrations

GMA 3.62

Estrada 4.4

Ramos 3.51

3.23
Aquino

Marcos 5.04

0 1 2 3 4 5 6
(in per cent)
The Philippines is a signatory to many free
trade agreements as a member of ASEAN

1. Agreement on Agriculture under the

World Trade Organization
2. ASEAN Free Trade Area - Common
Effective Preferential Treatment (AFTA-
CEPT)
3. Other ASEAN Agreements
Other ASEAN Agreements
Free Trade Agreements Year signed Target date f or the
establishment of Free
Trade Area
ASEAN Free Trade A rea Š 1992 2003
Common Effective Preferential
Treatment (AFTA-CEPT
ASEAN- China 2002 2010
ASEAN - India 2003 2016
ASEAN- Korea 2005 2010
ASEAN Š CER ( Australia and 2008 2013
New Zealand)
ASEAN-EU under negotiations
The Philippines has a negative
agricultural trade balance with ASEAN
Value of Philippine Agricultural Imports and Exports to
ASEAN, 1994-2008

3000

2500
(in US Million)

2000

1500

1000

500

0
1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008
Export Import
The Philippines has a negative agricultural trade
balance with most ASEAN countries

RP Agricultural Trade Balance with ASEAN

200,000

-200,000
(in US $ '000)

-400,000

-600,000

-800,000

-1,000,000

-1,200,000

m
ei

os
ia

d
sia
sia

re
ma

an
un

na
po
La
ne

lay
bo

ail
an
Br

et
ga
do
m

Ma

Th

Vi
My

Sin
Ca

In
Bulk of the country’s poor is in
agriculture
Share of Sectors to Total Poverty, 2002

70 61.6
60

50
(in per cent)

40

30

20
6.3 9.2
4.7 6.7
10 0.1 1.7 4.2
0
0
ng
nce

ing

es

n
re

yed
de
tie

io
ltu

vic

Tra
uri

uct
Min
a

plo
li
Fin
u

Uti

Ser
t
ric

fac

str

em
Ag

n
nu

Un
Co
Ma
Many farmers are poor
Poverty Incidence by Sector, 2002

48.5
50 44.8

45
40
35 28.5
(in per cent)

30
25 15.7 16.6
14.8
20 11.14
15 7.7
10 2.1
5
0
e

ed

re
nce

ices

ction

ng
ties

Trad

turin

cultu
y

Mini
Fina

Utili

mplo
Serv

stru
ufac

Agri
Une

Con
Man
Arguments for Agrarian Reform
 “Improvement in land inequality is not just
about advancing equity goals; it is also about
raising the trajectory of income growth by
improving overall economic efficiency”
 “Developing countries with high land
inequality can generally be expected to have
lower long-term income growth rates and
slower pace of poverty reduction.”
Balisacan, 2007
Arguments for Agrarian Reform
 There is also sufficient evidence that agrarian
reform is successful in raising agricultural
incomes and in decreasing poverty. A study
conducted by the Philippine Institute for
Development Studies, covering 1,500 farm
households, indicate that the average income
of agrarian reform beneficiaries (ARBs) is 23
per cent higher than that of non-ARBs.
Reyes, 2002
Arguments for Agrarian Reform
Ang Kwento ni Ka Vic Fabe ng PAKISAMA
increased motivation to improve production
bigger room for innovation
greater responsiveness to the market
greater interest in good governance
improved incomes
household food security
better welfare
more vibrant communities
Agrarian Reform creates a positive upward spiral for farmers, their
families and their communities
Large landholdings remain
largely untouched
Table 2: Farm Size and Classificatio
FARM SIZE and CLASSIFICATION
(in '000)

ITEM 1960 1971 1980 1991 2002

NUMBER OF FARMS BY SIZE (THOUSAND FARMS)

TOTAL 2166 2354 3420 4610 4823

Under 1.00 ha 250 319 776 1685 1936

1.00-2.99 ha 1101 1118 1578 1968 1975
3.00-4.99 ha 405 558 588 523 509
5.00-9.99 ha 290 244 360 325 303
10.00-24.99 ha 109 101 104 96 89
25.00 ha & over 12 14 15 13 12
After more than 20 years, DAR has already
implemented 70 per cent of its PAL Target
DAR Land Distribution as of June 2009

6,000,000 5,163,751

5,000,000 4,119,196

3,353,784
(in hectares)

4,000,000
2,336,125
3,000,000 1,809,967 1,783,071

2,000,000

1,000,000

0
Private Agricultural Non-private DAR Total
Lands agricultural Lands

Scope Land Distributed

AR implementation in the final
stretch
DAR and DENR Land Distribution abd Balance, as of June
2009

6,000,000 1,044,555

5,000,000 520,688
(in hectares)

4,000,000
4,119,196 3,317,311
3,000,000

2,000,000

1,000,000

0
DAR DENR

Distributed Balance
AR Implementation in the final
stretch
DAR and DENR: Number of Agrarian
Reform Beneficiaries, as of June 2009

3,017,254 3,048,578
3,500,000
2,396,096
3,000,000 2,223,133

2,500,000

2,000,000

1,500,000

1,000,000

500,000

0
DAR DENR

Target Number of Beneficiaries Actual Number of Beneficiaries

How can the next administration best
implement agrarian reform? 5 points.
1. Ensure that there is actual budget for
land tenure improvement
CARPER Allocation - 60 per cent of 150
billion for LTI (Php 90 billion)
PLEASE! Not the fate of AFMA
How can the next administration best
implement agrarian reform? 5 points.
2. Synergistic approach to beneficiary
development
Budget for support services - 40 per cent
of the Php 150 billion CARPER Budget
(Php 60 billion)
Inter-agency support package
How can the next administration best
implement agrarian reform? 5 points.
3. Innovative approach to land tenure
improvement and beneficiary
development
Greater PO-NGO-GO cooperation
Establish mechanism for stakeholders to
validate/provide feedback on DAR
performance
How can the next administration best
implement agrarian reform? 5 points.
4. DAR Rationalization
Save money - phase out offices/personnel
where no longer necessary
Establish accountability mechanism - ensure
that farmers can input in the evaluation of DAR
personnel performance
How can the next administration best
implement agrarian reform? 5 points.
5. Eliminate opportunities for bigay-bawi
(reversals)
Revise relevant IRR, administrative policies
and procedures that makes bigay-bawi
possible
Involve POs and NGOs in the formulation of
IRRs
Provide legal aid for farmers
Salamat po!