The Prospoects of Philippine Food Security Under the WTO | Food Security | Subsidy

Fqcts &FiEure

vol.24. NOS.23 24 &
15 & 31 DECEMBER OI 2O

IBON

lSsNl15.8007 0

Prospeds of The Food Philippine Security the Under WTO
O t hasbeentoutedthat tiberaLization woutdfostereconomic ! of agricutture gtobat hunger. I growthanderadicate of Butsix yearsafter the inc€ption the (AoA) undertie on Agreement Agriculture (WIO),peasants, Trade Organization World and civiI organizations, even advocates, society governments raising vitaL are the ThjrdWorld in question: the problem foodsecurity of Can pursued the context in be deveLoping countries agricutture"? of a "gtobatized 2001,two internationaL In November world teaders to witl convene events of openup new rounds negotiations The relatedto agrjculture. WToshall in hotdits i inisterialConference to Doha, Qataron 9-13November the and djscuss expansion refinement of theAoAfor furthertrade among othernewand liberatization, non-trade issues. Days beforethe WTO present the Wor(d lv{inisterial, countries at '1996 reassembte Food Summit in witl in Rome take stockof the progress to madein reducing hunger the pastfive years. in Forits part, the Phitippines faithfutty has fotlowed prescriptions ag.icuttural the on This into the impactof tiberatization. issuetook5 poticies the country's gLobatization on food

secunry.

AHungry Country
Foodis themostbasic necessityto nourish oneselfandto perforn productivefunctions for survival.Thus,a siatethat is sincerein fighting hunger due to pov€rty must address problemof scarce,coslly, the and unstable unsafefood supply. to By responding the food problem, govemment meels, theworid Ba,rt as also notes,"the basicrequirement social of ha|mony,economicgrowth, and by politicalstability." is why This extension, food securiryfinds prominencein every particularlyin the increases, or seasonal gov€rnment unemployment, Is FoodAYailable? agenda, wars poverty prevalen! is and leave people Philippineshere x wlnerable. Laslly,available According the FoodandNutrition to is manifestation. loodmustbesensitive cultures to because hunger its mostextreme or Research Institute (FNRI), an averag€ certainfoods,food combinations Ill 2,036 kilocalories 51.5 and handlingnethodscan be preempted by Filipinoneeds grams of protein to food Security perform production as by activiti€s per day or Foodsecurity, defined theWorld in a recommended Food Sunmit in 1996,is a siruation 2) dietaryallowance which:I ) foodis available all times; al (RDA) consistins to of all people haveaccess food;3) foodis supplyandofsufiicient quality 773 garns ol in adequate vegetable originand and variety;and 4) food is considered 258grams by cultures. Based on ofanimal 6cceptable specific origin.(See Table1) the FoodandAgricultwe this definition, (FAO) oftheUnired Nations Organiarion Isl In 1999, the has sei four crucial faclors in achieving country's Food food securjty.These are availability, Balance Sheet stability,and cultural accessibility, (FBS), balance offood supply. the of acceptability I2l foodrequirementsto Availability neans tbat a socieg'has that eachpelson's religious culrural actual foodsupply, showed 105.6% a food or taboos. enoughfood to ensure [21 This thatthecountry's and can Food securityin any societymay be sufiiciency- meant daily energy nutrientneeds bemet. however, realized the€fiiciency ofthe society\ food supplywas ampleenoughto sustain Evenwith adequale supplies, by Afood systern isthechain of theRDA.(See Tabl€2) Ontheorherband, food securityis not met when people foodsysten. (or ratios iheir foodproduction post-harvest catch) supply and overconsumption for eners/,. cannot affordto buyor produce/grow means such as storage, processing and protein and fats, on fhe average, were own food. Accessibility,therefore, at 0.7,I 31 andI 32.5percent, that socieryhasequitableincone growth distribution. According FAO,th€ food estimated 13 to to foodneeds. systemshouldhave the capacityto resp€ctively, from 1997 to 1999.(See thalallowspeople acquire shouldalso be stable produce, store importsufficient and food. Ttble 3) This meantmorethan enough Food supplies per in and consumption. because severefluctuations food Il musthavemaximurn autonomy self- foodsupply capita However, ough totalavailable lt alft ihe availabilityor accessibilitycausedby determjnation. must be reljable, percapita and foodsupply exceededthe RDA factorssuchasdrought,flood, sharpprice sustainable equitable. [21

IBON Facts

& Fi9ures

in 2, from in 1999 shown Table supply as originsuch meat, as ofanimal foodgroups was22% shortofthe frsh,milk andeggs and RDA. Foodsupplytromthevegetables ftuits food group was 33% shortof the RDA while that of cerealsand cereal products was 22.9 gramslessthan the plus and cerealproducts RDA. Cereals 3nd vegeiables fruits makeup 6 I % of the Filipiro'sdiei. In 1999,toial domestic supplyof was l8% and cerealproducts cereals and utilizatlon. imported 24%for non-food to that This translated a localproduction was34%shonofthe RDA. In padicular, Total domesiic rice was 12% imported. of meat was 5% i.nported.In supply partieular, beefwas22% imporled.Fislron hand was 3% imported,4% for the orher 6% ulilization. export.and for non-food Is FoodAccessible? Theminimum wagefor theNational is P250, sumthatcolers a CapitalRegion tbe daily cost of living only 48.5% of (DCOL), which IBON estimates at 2001.In other as P515.24 of Septenber who earnsihe words,a breadwinner ofP6,500a monthmeets only minirnum P15,15',7.20 for a family cost 42yoof rh,e ofsix to live decently. the But the govermentslopped use in of DCOL as a measure 198? and ihe scrapped concep!of decenlliving.

Food Groups L VeserobleOnsin Ceredls/Products StorchyRoots&Tube6 S0gor ond Syr0ps Vegetobles ond Fruils Fots,Oilsdnd Others It Animol Orisin Meot ood Fish P.oducts Mlk ond Milk Producls

1,031.0 773 334 73 24 17 297 2A 254 151 82

1,088 888 333 52 3l 200 226 200 183 8 9

105.6 I 14.9 99_6 71.4 189.8 182.8 67.5 808.3 77.5 121.2 9.4 37.5

whicbncansthateach Filipinoneedsonly suchamounl meethis or herdaily dietary to requ iremenis. Thistmnslates anabsurdly io low food$resholdofP8.38permeal, and only peoplefalling below this amount, accordingto the government, may be considered andhunsry. poor Despitethe ridiculously low food threshold, liom tle National dara Statistics Officeshowthat 21% of the Filipino (or The per capita food thresholdor families I6.5 million peoplc) still fell subsistence tkesholdis pegged P25.15, belowthethreshold 2000,a figur€that at in waseven12%higher thanlbe record 1997. in [17] But the whol€point in povertyis to set a redelining low stardardin detennining the minimum wage. Thus, the (kcol) 2,226.0 2,145.7 supply Per copitoper doyenergiy minimum wage in th€ country 1,684.0 o/ Per codio enersy consumpnon Fcol) bar€ly coversthe cost of food anddecent living. 138.4 130.7 (%) Supply/consumplion The lack ofa living wage is further aggravated the by 67_0 65.8 69.3 65_4 Percopito per doy p.otein supply (s) €ontinuing increases the in Per€opito prorein consumpiion(s) pricesoffood andorherbasic (%) i34.3 I31.8 138.9 I31.0 Supply/consumplion commodities- inflation The rat€ 40.6 Pei.opito per doy fois supply (s) 37.6 for food movedup to 5% in Percopito fois consumplion(kcol) July 2001 cornpared 2.3% to 143.1 132.5 supply/consumplion(%) the pr€viousyear. Prices oa eggs and fish, the cheapesi FourthNotionol Nutrilion Su ey of 1993 a/ Bosedon the resuttof FNRI'DOST sourcesof prot€in-energy l s b / 1 9 9 3 d o t do n d o ' l yp e r c o p i t oc o o s u m p l i o in o s s u m e do b e t h e s o m ef ' o m 1 9 9 7 r o 1 9 9 9 nutrients,continu€to shooiup alongwith the pricesof rice, corn, fruits and v€geiables-

govemmeni the lnstead, reduced levelof living to mere subsistence, in the and process redefi poverty. ned Acco.dingto the NsiionalAntiPovertyCommission, per capita rhe poverly whichmeans threshold P38.12, is tyithless rhanP38.12 thatonlyrhepercon a dayfor bothfoodandnon-food needs is poor by rhe Phiiippine considered

I 5 & 3 1 D C C E M B E R2 O O I

(seeTable4) The lack of a food distribution in the alsocompounds problems network income levels and foodprices depressed Is FoodAdequtte? income ofthe the obviously, average Filipinoscannotmeet the cost of their caloric and minimum nutrient Aside from the fact that requjrenents. camot atrordtheir food needs, Filipinos with shrinking they are also threatened localfoodsupplydueto effaticpoductlon From 1992to 1999,iherehasbeena instabiliryin agricultural noticeable (See produclion. Table5) mustgrow food Domestic produciion of with consislenlly the growingneeds a growingpopLrlation. on a yearly But has Philippine agriculture gown average, by only 1.1% whjle ihe Philippine populaiion increased 2.3 percent has b)lYas clop From1995-1999, Prcducron average onLy recording anannual unslabie, Palay com and growth of2.08percent. rate plunging eveD by production effatic, was production was 2l% in 1998.Fisheries of by dis al, struggling a yearlyaverage 0.2? percert. Ahhough increasing for consistendy four years,lhc poultry p in sector lunged I 999.Onlythelilestock by has secrof beensteadil)increasirg an a o annual verage f 3.44 (See Table6) percent P hi l i p pi n e The gov€mment attributesthe poor performance of pallicularly crop agriculture. production. cropshifting. lo of The BurcaLr Agricullural that expLains crop Statisljcs shiftingoccurswhen local producers lvant lo take of advantage increased in demand the world market for agriculturalgoodsor io liom decreased avoidlosses food of demand traditional has also Government cited the dual effectsof La NinaandEiNiflo, andother as weatherdisturbances reasons the low tumout for In truth, however,

4

IBON Facts

& Figures

has agnculture beenin chroniccrisisasfar Th€ features ofth€ back as the 1970s. agrjculturalcrisisarestructuralin natureofscale, smalleconomies iolv technology, and landlessness, landmonopoly,to name a few. Thesefeaturescontinueto cripple productionandagriculturaldevelopment. FoodIns€c[re

Foodinsecwity js detued by FAO as of a situation "low level of food intake, which can be transitory, seasonalor chronic."FAOindicato offood insecurity ofthe are:l. und€mourishmentestimates TheljN FAO countsas foodhtakedoes whose number ofpeople one criterion of food not provide enoughcaloriesto meettheir securirythe stability of and 2. basic €nergy requirements; food supplyeven in low lev€l of mdemulrition- prolonged times of natrral, m?inoffood food intakeand/orpoor absorption made, or €conomic of consumed.The manifestations in disasters. Inslead ofciting self-reliance undemukitionare wasting,sluntingor food as an importantfactor,however,the cognitiveability, reduced underweight, importance food ofa poor health status,and low productiviry. FAOempbasizesthe to system that hasth€ capacjty produce, I8t food. and 28% store impoilsuf}]cient According UNICEFreports, to governrnent likewise The Pbilippine old ofFilipino chil&enunder5 years are lookrat thequestion ofslabilityin supply 6% and moderately severelyunderweight, view. ln its moderatelyand severelywasted,and wiih the samemyopic dre agriculturalplan, the Agriculiural and stunted. and 30%arenoderately severely Modemizalion (AFMA) of Act tems, one out of every three Fisheries In simpler dependence 1997- government the declares Filipino childrenis undernourished. food importationas a viable policy Filipino on lncluding adults,FAO estimates to option.Foodsecwity,according theplan, at 1i.6 rnillionpeoPle. undemutsjtion l9l achieved through:1. self-sufficiency canbe Il01l8l fion adequate supplies food is a Paradoxin or by ensuring Food insecurity production;2. self-relian€€ by or Philippine society.With fertile soils, domestic adequat€ food supplies tkough a and madneresources, aboutone- ensuring abundant prgduction and combinationof domestic ihird of its labor force engagedin and3. pure impotatjon. [111 agricultural productioD,food insecurity importation; Wlat is noticeable aboutthedefinition problemofthe nev€rbea persistent should is the downright insislerce of FAO and cormary. institutions that food the BeyondFAO indi€ators, irony. othermultilaleral foodsto€ks and is s€curity all aboutenough however, thattherural poprllaiionwhose is throughinportation, thatit canbe achieved livelihood is relatedto direct food productionis the most hungry anong the evenby Thftd World countriesthat have capable of Th€ ofPhilippine society. National beeniraditiolrally andnatumlly s€ctors in attainingself-reliance food- on the reportsihat the Anti-Potefty Commission have whose incomes contrarymanyThird Worldcountries ofhouseholds mostntunber precisely erodedtheir self-sufficiency camot blry a nutritious meal come from of Toppingthe list tirough decades import liberalization. largelyag cultural areas. are the AutonomousRegion in Muslim Mindanao,Bicol, and BasicCrisisFeatures Mindanao,Westem where These the areas aro Cental Visayas. The country's natual resourcesare foodinsecwity ismostrife. [7] ! abundantto feed the populaiion. lts coastlinewheremarin€resoucesabound

trosion of SelfSufficien

is fourtimeslonger thanthatofthe United On€-thirdofdr€ comtsy'slandarea States. is fertile andsuitablefor food production andanimal gazing. But aqalreadymentionedin relation of to inadequacy food supply,Philippine characteriz€d by agiculture is essentially peasant backwardness, landlessness, existing€xploitatit€relations, land and monopoly, etc.'Ihesef€atwesare resource alsoth€rootsofinstability offood supply in the country. Agriculturalmechanization still way is behind the .echnology used in industrialized countries. esnmaied I % An ? of the farms still use th€ classicplow as instead ofhard tractors farm€quipment. irrigation covers only INSOIAs of 1999, 42%ofpot€ntial irrigableareas. Arable tsj landsare larg€ly rain-f€dand still unmechanized wjth a rating of 0.3% per hectare mechanization versus a IJNDP recommendation 0.5% per hectarefor of developing countries. I l4l AlthoughtheUNDP analysis biased is agicultxre, for industrializedmechanized the fact rcmainsthai the low poductivity is ofPhilippineagriculture mainlydu€to the pevailing low technolog/.

I5 & 3I

D E C E M B E R2 O O I

dosages import€dinputs.This was of complemented the big credit program by thatallowedfamers to purchase inputs the bui pushed themto perpetual ind€btedness. Underthe SABdrecountryevennrally eliminated credit,production and price subsidies, liberaliz€dagriculturalirnports. andderegulated marketingoffood crops suchasrice, com, sugarandcoconut.By the end of 1992, only 2l agricultural commodities price controlsout of 632 had

in 1970.The SAP pavedthe way for a compreh€nsive trade liberalization program,which cut dowr tariff rates, reduced numberoftariffied the goods, and r€movednon-iariff rcstrictions.[61 By the 1990s, country th€ wasunder another SAP, dubbed as"hilippines 2000, which amongoth€r things prioritized the production of High Value Crops(HVC), export cropsthat command high pricesin ihe world market.Examplesare pili nuts,

f.,rla
Seven of 10 peasants do not out stjll o\l! thelandtheytiL Only 5% ofthe landowningfamilies contlol43%ofthe total land. Ir5l Th€ countryhas agricultural alr€ady threelandreformprogramsin had five decades, nothing much has but changed the ownerslip structurein in agriculrure. and continu€ sell to Merchants usurers at modeminputsandmachinery high costs, ofler creditwith tall interest rates,and p€asants' produc€. underprice Govemment, the otherhand,does on for not havepdceandFoduction subsidies fanners, Allhoughgovernrnent encourages farm mechanization to increase productivity,ii is mostly in the contextof importationoftecbnologyandat the same time incr€asingexport crops to earn dollars, Government is currently inhoducirg so-cailed market-oriented land is mainly in the cont€xtof reform,but this a globalizedagriculture. The Crine of Liberalizstion policiesto implement Govemment food "globalization"have exacerbated instabiliry. For instance, structural ustinent the adj prograrns(SAP) under the Intemational MoDetaryFund and the World Bank compelled the Philippines to transform farmsto modemonesthrough subsistence (HYV) theuseofHigh Yielding Varieties of rice and com, which required healy

1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000

1,083,958 1,245,133 r,t4r,4rl 1,337,332 r,342,080 1,351,279 1,404,123 1,342,017 1,273,605 l,l83,l t3 1,290,777

627,951 809,082 1,016,925 I,t 68,208 1,385,575 1,891,848 2,273,555 2,241,170 2,245,609 2,O12,271 't,965,735

n4,4A6 436,O51 121,186 169,121 113,195) (540,569) 1469,132) (939, 53) r 1972,OO1) @29,158) 1674,958)

Nol€:For 1990,imports

6

IBON Facts & Figures

cofee, castor maigoes,casheq cassava, and bean,asparagus, culflowers. and agribusiness To encourage to plant lryC, the govemment landlords ta{ hasprovidedincentives, holidaysand and infrastructuresupportand technical other perks.For export crop production, governmenihas also promoted contract growing,whichaltowsdiect participation corporationsin food of iransnational production.[6] Sincerice and com are no longer profitable,accordingto the govenment, is for landallocated cereals beingreduced of favorofHVCs.Riceandcom lands in to shft-nk 6 6 in millionhectares 1990 7-l m in million hectares i999, resulting a producrionlBASl in decrease agricuhural lo Yet, govenmenthopes reducerice and landsfurther to 1.2 million and corn respectively700,000heclares, [6] the Deparhnenlof Agricuhure Recently, closeto one its hasbared planto devote to of farmlands HVC million heclares production. This shall convertfirther landsallocatedfor food ploduciion 116l As a result of the overall thrust specifically liberaljzation, for €€onomic government's attractionof foreign in industialand projects, iand use estatesdevelopment to industrial Fom agdcultural conversion has usesor real estate becomerampantrn lotal recentyears.From 1979-1989, land use for applications approved Aft€r 9 totaled I 3.86hectares. conversion a decade,the figur€ balloon€dto Table7) Thereal hectlres.(See 30,800.43 €xtent of land use conversion,howev€l are othercases is indetermimbleb€cause simply achievedtluough land grabbmg ofso-called landreform andcancellation certificates.[6] Th€ basic featues of the crisis in Philippine agriculturc are intensifiedby policies. thegiobalization among the effects of Gtaring liberatizationis the int€nsificationofthe colonial trade pattem,which erodesthe in comtry's self-reliance foodThe country has been importing food since 1953.As a result of trade on libemlizationandthe emphasis lrnpoft insteadof solving basic dependence pro6lemsof domesticproduction,the has Philippines betomeanetfoodimporter (S€€Tsbl€ 8) r in the lastdecade.

Food on Impact Securitv
U

of the On€ effects contloversial of the AoA is the tnreat 0n a aPParent global scaleto food security of nations, The particularlydevelopirgcountries. by WTO is clrrently beingblamed activists worldwidefor lhe failure of the world Food Sumnii to achiev€its goals, paricularly the reductionofworld hunger blamed byhalfin 20i 5.TheWTOis being governments aclivistsfor and botb by food securityin the nameof endangering so-calledmarketaccess, in of in 1996,l€ad€rs 186countries to the Worid Food Summitcommitted that ensure food tradeandtradepolicies would foster food securityfor all. of Tbe QuebecDeclaration the the summitrecognizes right to producein a sustainablemanner from a sound basis,securityof tenure,and economjc h€althy soils, with reduceduse of and pesticides.It also agrochemicals access the recognizes needfor equitable to, and control over, land and other productive resources fam€rs, fisher by It folk andotherdhectproducers. proposes ownershipanduseof land shouldbe that democratized. [5]

But the AoA is apparentlygoing of$e World against basicprinciples the FoodSummii. Dealhto SmallFarns Food import bills of the dev;loping of by countrieshaveincr€ased an average on the 20%since AoA. Dependence food imports has grown especiallyin Latin Afiica, both America and sub-Saharan whichhave historicallynetfood exporters, now becomenet jmporters.In the food import biil incr€ased Philippines, from $43.5million in I 994to $972million in 1998 whenit washighes!. [NSO] mentioned, entry of the As already food productsthreatens cheapsubsidized the very survivalof small fams. Since cheapimport€d crops and foodstuffs are locally produced onesar€ available, market. displaced thedomestic in and Small farns, subsistenc€ level, are the majorityin the household developirg countri€s, and a large percentage ofthe populationrangingfiom to in continues €ngage this 60 to 80percent non-comrnercial ofagriculture.I3l In !?€ farms subsistenc€ employ thePhilippines, 70%of 33%ofthe laborforceard around food The th€farmingpopulalion. increased

20 & 31 DECEl|ABEn 0r

directly with the only importscompete farmershaveto sell thing the subsistence - the minuscule surpluses locally of producedfoodaround only 10%global ln reality, food productionjs traded.Food securityfor most countriesis achieved lhrough domestic production, oft€n by subsistence without anyofthe taxpayerfarmers subsidies 6mdedtechnical assistance, to and cr€ditsavailable large-scale agribusiness. ad ftuiners transnational This reality is the very nature of Philippine agriculturelrom which the country derivesits food secu ty that th€ The AoA erodes AoA has threatened. which in Philippineagriculture, traditional insecurity political and tum deatesfood instability.The shift from subsisrence farming to a markel and wage econony through trade liberalization has the marginalized majorit the famers p€ople ableto affordfood less andleftth€ due to declining incomesand loss of livelihood.

pricing. speculation monopoly and This goesagainsipublic interest of pr€dictingfood shonages price and fluctuaiions thesake for ofconsumersBecause the phaseout public of of stockholding trading,purchases and have been increasinsly from comm€rcial sources while access to food ai prices concessional have beenlosr,and this situation has conlinuousl)' increased prices. 1998, food In the FAO estimated priceincreases the in dueto manipulaiion thenetfood importing developing countries an at average of20 percent. l3l Pric€Distortions The w'thdrawal of governm€nt support also fails to reduce price levels theUSand distortions. Production in the EU remainhigh evenifworld p ces

t3l

ofrice evencontrol overlocalmarketing This is because ofthe fact thatthe USNFA had to rely was also reducedasthe EU havenaintainedhish subsidies. Farmers mostly on scarcebudgetaryallocations in Japan, EU and the US receivean the ratherthaneamingsftom import tariffs. per ofUS$20,000 yearin domestic Recenily,NFA functionssuch as average whilepoorfannersin thedeveloping prices and suppon controlling the supply, PriceManipulation distributionhave been reducedto countriesare alreadybeing €xcludedFom swpolt. TheFilipino fanner,on is Th€ withdrawal of gov€rnment marketingandtbe agency actuallydue govemment receives theav€rag€, $121a year.[DBM] famers and for privatization underthe $175-million support agicultwe disables in As world prices fall, the US and EU consumers continue operating the ADB loan for the Grains Sector lo nenvork. DevelopmentPlan. The specific automaticallyincreasetheir subsidiesand supply-consunption lo at Third Worldgovernments, conditions theloanincludedereguiation continue selltheirfoodstuffs lessthan to In addition, thecostofproduction, bothdomestically and by liniiing NFAs through variousloanconditionalities the ofNFA pricingmechanism, abroad. In theprocess, tbeycushion their procurement 30 daysby July 1 [3] to WorldBankandthe AsianDevelopment annual and and Bar*, aremadeto privatizeandderegulate each year inclusiveof governmenl local producers Focessors more their tunctionsin agriculturein tune with lmporls, lifiing of resiricijonson rice importantlybenefii the TNCSthat condu€t trade liberalization. Third world importation,and privatization of the trade and enjoy rnassiveprice advantages and processors other in gov€fiments tradingandmarketing tunctions. over producers had iraditionallyplayeda ag€ncy's role in food djstributionby I20l significant lmport controlswill be relaxedin interveningin marketing,subsidizing publicwarehouses piices that b€nefitedboth farmersand 2004.Meanwhile, werc BrokenFoodChain b€ rnaize already leasedto existingrice cartel This the consumers. would typically The FAO citesa strongfood systemas go theverytaden r€sponsible the 1995 for in Afiica andric€ in Asia. This would an imporlantelementin achievingfood on for mostdevelopingcountriesuntil the ricecrisis. programsof the Th€ privatizationof food trading security. But food systemshave be€n structuraladjustment impairedunderelobalization. pricetransparencythemarkel. severely in or 1970s 1980s, until theWTO mad€ r€duces and This hasbeenmainlybecause the of illegal.[3] For instance, despite decreasing world son€ofthe polici€s of "consolidation" eachpart of the food govenmentcontrol prices, local prices €speciallyfor net In thePhilippines, trade suchasthePhilippines chain. From national bufier stocks, food ov€rintemational waslinited to rice importingcountries processingsupermarkets, cultivation,down as in fte late-1980s theAquiro govemment productionfood to feftilizer andpesticides holders For instance, majorgrain the dismantled several of th€ direct systems have long lost their autonomyto pfice andmarketregulations. are the kading companies govemment thems€lves, rule. [3] The mostaffected by price monopoly was Intervention limited to the role played which can control supplya,nd frorn suchareThird World counldeslvhosefood by theNationalFoodAuthority (NFA).But informationand gain immensely

IBON Facts

& Figures

possible hazard humanhealth to despite and the €nvironment.The Philippine governmentrs set to approve the productionand importationof food products containingGMOSaswell asfood produced genetic via engineering. line In Consolidalion is carried out Committeeon th€ with this, tbe National principally TNCS, whichdominate by has subcontacting and Biosafel ofthe Philippines approved foodchain- production Bukidnon,SouthCotabato, tradeandinvestnentin agriculturalinpuls l0 sitesin for Camadnes andPangasinan Sur, food securiry lsabela, not andproduce, lo assure on themselves ofprofits. fi€ld experiments GMOS.U9l for all, but to assure weakduero agrarian systems inh€rently are iack of land backwardness, tenwe system, and import dependenc€, industrialization, slackgovemmentsupportand regulatory of is Oneexample the consolidation Cargill (a promodity seedtader and the privatecompany th€ US) and in largest made Monsanto(a chemicalcompanY by famous its promoiionof genetically are examples crops). Other engineer€d [3] ofagro-chemicalgiantsDow the mergers Chemicaland Union Carbide and of life giants AgoErvo sciences/a$o-chemical andRhonePoulenc.[4] Co$olidation in thefoodchaincreates problems pricetransparency markel ard in For exanple, consolidated distortions. food systen in chickenproductionin the US canbring abouta Philippinelanded in cost of P22 per kilo. Whenimported massivequantitieslast yeat chickenlYas with sold only at P60p€r kilo compared soldat P80perkilo. [1] thelocalchicken Other Market Manipulations The abuseof the Sanilar] and m€asures the AoA has of Ph)losantiary Third World food also marginalized producls mark€t. from the intemational protect AustraliaandBelgiumfor example their na*ets by hidingbehindconsumers' ln interests. 2000, Beigiun pulled out Philippine cannedtuna fiom ils grocery to due shelv€s allegedly the poor quality ofPhilippinecansusedfor the products. beli€ved of The Depafiment Agriculture wh€nthe measur€ this was a retaliatory govenment imposed banon a Philippine Belgian meat and dairy producls lvith corlaminated dioxin,a cancer-causing delayed Focessing the substance. Australia to of the countrf's export applications Philippine mangoes,bananasand pineapples failedio ailegedlybecausethey pass standards. intemaiional U8l TNCSof the developed Meanwhil€, for the countiiesaresecuring markets their (GMOS) genetically modifi€dorganisms

I4l

Threat to Sover€ignty Dependence food imports is on growrng yet export revenues are continuously declining.Thus the usual should focus argument lha!poorcountries on exponingto raise foreignexchange eamingsto enablethen to buy the food th€y need fron world marketsis not poor On happening- the contrary, are fast becomingn€t countries importennor onLy foodbut also of as of othercommoditles well, leading urprecedented to national banlsuptc'es. \lhat is happeningso is far of that agriculrurai exporlers courhiesbave the developed the favorableconditions

(despite worldpric€s) increasetheir to low the and in exports anddominate market, from the process restriclpoor couniries inplementinga policy of food selfWlat is happening far is that so sufiiciency. everythinghas been for the benefit of which has transnarional agribusiness tremendously increased scope size its and since ihe WTO. Market-oriented agriculturaitrading systemand industrial has andconnercialagriculture erodedtlle production system the subsistence of fanners,threaten€d food security,and poveny and hunger,all for the increased agribusiness€s benefitof hugetransnational t of developed couniries.

.YN
l5 & 31 DECET ER 200r B

A0A: TheFinal Blow
Mainty responsible for lhe worsening food situation is the advent ofthe AoA, of which ihe Philippine Sovernmenl signatory. The AoA is on€ of the one components ofTradein Coodsi ofthe Agreem€nl on six pafs of the General Tariffs and Trade - Uruguay Round, which, whencombinedwith the p.evious beginningin 1947,are GATT agre€ments betterkno*n asthe wTo Agreem€nts. The WTO Agre€m€ntscover to traditional areaspieviouslyr€sistanl multilateraltradereform(Tradein Goods, GATS,TRIPS,TradePolicy Review Mechanism, Disput€ Settlement, The Plurilaleralagr€enents). AoA thusis in most comprehensive liberalizing agriculturaltade. Aside ftom its expansivescope,the because AoA is aho &o mostcontroversial of two rnajor kinds of issues.One, it is agreement Fobably the most imbalanced among othermultilateralandbilalemltrade Two, it has probably the agr€em€nts. greatest impact on th€ developing particularlythe farmersandtbe countries,

Tariffs are customdutiesor taxes imposedon imponedgoodsto protect domestic industries and production. Likewise, tariffication bars the entry of foreigngoods maybeproduced that locally. Subsidies state-support are mechanisms io producers the form ofresearchand in development, infrastructure, direct procurement, incomeand pric€ support

All of theseprotectlocal industries ftom directunfaircompetition wiih foreign products. theAoA bansthe useofany But Th€ mostimbalanced of thesemechanisms. The AoA is said to be the most The AoA provides for: 1. increased imbalanced because, asidefiom exposinS marketaccess ihrough tariff binding the wlnerable feat res of Third World (naintainingtarifirat€s prior to theAoA), agricultures unduecompetition to with Firsr tariff reduction,and tariffication (the high{ectnologyhighly subsidized conve$ion of all quantitativer€strictions World agricultures, concessions the or phased specialand ditrerentialtreatmentgivento intotaritrs,whichwill be eventually down); 2. th€ withdrawalof domestic the developingcountriesare not enough production support; the reduction 3. of for them to cushionthe impact of trade and liberaiizarion. budgetary outlaysfor exportsubsidies; [6] 4. the har-monization sanitaryand of As a result of minimum acc€ss phytosanitary measures based on commilnents, countries have import will to accepted scientifi and cally modestanounts of their most protected intemadonally justifi abiestandards. agdculturaland food producrs.Although [6]

the tarifls may still be quite high, such conrnitmentsstill allow cheapimportsto competeagainsthigh-costdomestic products, In subsidies, developing countries had alreadyusedminiial subsidies th€past in or hadbeenasked intemational by creditors to r€duce bsidiesaspart ofliberalization. s Som€ countries such as the Phitippines ev€nhad zero"levelsubsidies prior to the AoA. Thus, when th€y cornrnittedto the AoA, their percentag€s were alreadytwothirds of their existing subsidies. Meanwhil€, perc€ntag€s reductionfor of dev€loped countries represented only a smallportionoftheir existing subsidies. In fact, the United Stat€sand rhe EuropeanUnion succeeded excluding in Fom reductionseveraltypes of subsidie3 such as US direct paymentsand EU pa)ments,aiongwith a long compensation list of other non-actiorable subsidy programsDevelopingcountries managed to gain minimal special and diff€iential treatmentand exemptf€w subsidiessuch asinvestment inputsubsidies, th€se and but ar€minimal ifcomparedto theUS andEU

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in The US and EU also succeeded fiom "due exempling certainsubsidies restraint" aclion by the WTO. The AoA provides countervaiiingmeasures, otherwise knownas"due restrainf' actions againstsubsidies, the US andthe EU but put in several typesof subsidies the in Box, Blue Box, AmberBox, etc., Green which are €xemptedfrom countewailing Thus, investment and input measur€s. for couJrtries are subsidies thedeveloping not exempifrom countervailingmeasuJes while governmeniservices, direcr payments, for the developed countries etc. measures. areinmuneliom such [l7] impact The gravest

1990 l99t 1992 1993 1994 1995 1996 1997 1994

1,701 1,845 1,866 1,918 2,072 2,499 2,307 2,334 2,225

1,555 1,260 1,560 1,626 2,114 2,649 3,096 3,102 2,495

146 s85 307 292 -12 -150 -7a9 -764 -670

Department Agriculiurehas also of garlicandonion declared Philippine rhai dumped its fannsaredead because China ownn thecounby. [4] For the farmers, this has spelled and banklptcy andhunger sincetraders middlemen longerpurchase famle|S' no the produce, if everat a]l,theydepress or the pricesr 2000 alone, farmgate in farngate pricesof food cropsin the Pbilippines declined asmuchas9%, ibrcingcom by From side the ofthenational economy, farmers instance foregohanesting. for to theAoAhasintensified colonialtmde Philippine the com is 200%moreexpensive pattemand eroded self-sutrcjency. The thanAmerican corn.[241 a nei Philippines become consislent has For the consumers, has meant this products importer agricultural of since the disempowelment in theirchoices, whether in AoA. (SeeTable As also 9) shown Table cullurally interms or ofenvironmenlal and 8,thecllronic negative balance oftradein health issues. 071 foodstarted with fie implementation ofthe But aren'tcheaper commodities food products consumers and agricultural for From the side of the farmersand supposed be the benefilsof trade to the consumers, AoA haspavedthe wayfor liberalization? Despiie deluge the ofcheap goods thedumpirgofcheapsubsidized thal imports,corsumersin the developing high-production-cosl direclly competewith countiessuchaslhe Philippines not are localagricultural foodproducts. the enjoying and In cheaper food.Onthe Philippines,for instance, locai sarlic average, retailpriceof the the perkilowhiletheoneimported costs P110 frorn Taiwan is only P40 per kilo; iocal meat 68%more€xpensive U.S.or is than meai; and locally produced Canadian chickenis 61% more expensive than the oneconingfton theU.S.[6] In the first senester of2000, almost poultryfarmsclosed all Philippine down because U.S. nade a killirg by the exportingits chickenparts lower than pricesand the Filipino raisers domestic prices could not survivewith farmgaie lower than their productioncost. The oflhe AoA hasbeen most Theimpact in severe, especially the developing includethe countries. or official issues Maj for lack of marketaccess Third World as by ag culluralproducers, argued the Trade minisr€rs and developing counldes. also ofiicial negotiators complainabout insuflcienland undeffunded safeiynets and the iack of capacity properly to

anyimportedfoodproduct comes 200lo out moteexpensive ils landed than cost.[241 This is because of the issues one of dumping,especially Third 'tr'orld in countries wberelocaltradingcartels stiil proLiferate cahootswith fo.eign in agribusiness corporations, monopoly are pricingandspeculation. dereguLation Pfice has allow€dtradingmonopoLies and tr'ansratjonal corporationshave to absolute control ovef food commodities and to prices supply. manipulate and Thisin tum hasincreased aiready the highproduction cosis since canels alsocontroltherrade of impotedseeds fertilizers. and The AoA has resulted in a continuously shrinking localproduction in Third World agrjcultures and national economies haveincreasingly that become net impo ers of food and agricultural products. Itbasalso provided opportunities such impof allocaiions as andtakeoverof governmentagricultural and food marketing corporationsto landlords, traders, TNCS, and displacing tenanr I farmers theprocess. in

15& 31 DECET ER 2001 B

TI

alization ontinuing Glob C
The new Presidency ofGloriaMacapagalArroyo promisesto eradicate hungerand poverty throughn\e ofth€ implementation AgriculruralandFisheies Modemizatjon Act (AFMA). AFMA in realiiy is the implementingframework of the AoA. Il poverryalleviation, invok€s food security, socialequiryand incomeenhancemeni "wirhin the contextof the wTo".[lll Thus,it is aplanrepletewith conbadicting goals. allocat€s biilion P20 Thegovernment modemizahon. annual fimd for agricultural hand, is on [21]Modernizaiion, theother basedon continuingliberalizationof foreign capital, inputs and productsinto lt Philippineagriculture. is likewisebased supponandregulation not on govemment of but on the privatization agricultural to andliberalization ofthe sector servic€s localagribusiness. TNC andbig in To attracl foreign investments of agriculture,which is the main stategy AFMA, govemmentofiers incentivesto AFMA exempts the private investors. paymentof fariffs and €nterpris€sftom duti€sfor the importalion of all typesof inputs,equipment agriculture fisheries and AFMA alsogranls these andmachinery. enterpdses soleuse the oftheir importing purpose defeating avolved ihe of impods, to makingthesegoodsacc€ssible poor peasants. [ll which is the Farm mechanization, maingoalofmodemjzationunderAFMA, is actuallyan integralpa{ in agricultural production and development. accelerates It But minimizeslosses liom naturalplague. farrn mechanization only eff€ctive in is where there is a genuine countries refomchamcterized compreh€nsiveland by distribution of land without pay, ofcooperatives, theabsence and existence of colonial trade patt€rn and feudat exploitation.

AFMA continuesto promoteHVCS H\rys, in theprocess Lhe and reducing land production.It also area devoted food to is the guiding f(amework fbr NFA privatization. Under AFMA, the Arroyo governmentlargetsto acceleratethe Agicultural impienentalion Strategic of and Fishefies Development Zones (SAFDZ) for the establishment of infrasrucore. "ag culfureor fisheries productionand industrial complexes, processins zones". also SAFDZS include the esiablishment Agricultuml Reform of Communities. ThesehaYebeen the strategy reconcentrate to djstributedlands for IryC and IryV production.In effect, AFI4,4facilitateswide-scale land-use and cropcorve$ion.tll I President Anoyo hasalsopromised to bring affordablefood items lo the consumers fielding 116 rnits of by ni rolling "Tindahan GloriaLabandera" however stor€s. [2ll This is impossible since the government has actually committedto cut domesticsubsidies. Moreover tlis will jusr be a cosmetic step priceinoeases. to lhe chronic

In lieuof subsidies, government the is introducingcredit and financing schemes allegedly to protect farmers from globalconpetition.[22] But increasing rheseschemes off€red at high rates, are whicbpeasants cannot afiorddueto low incomeand producrion. Only th€ local merchants, landlords, TNCS and b€nefit so far from the credit institutions. In the fisheriessector,the Aroyo government pursues the ful1 jmplementation the Fisheries of Code, which promotes liberalization the of fisheriesand the reconcentration of distributed aqua-farmlandsto landlords andTNCS. [23] Obviouslt govemment solulionto the worsening insecurity hunger food and has been basically the continuationof globalization policies, which in th€ first place have erodedth€ country's selfin sufiiciency food.Unless Philippine the governm€nt veersawayfiom the dictates of multila!eralinstitutionsand the prescriptionson economicliberalization, hungerandpov€rty shall conlinueto grip the Filipinopeople, especially direct the foodproducers.

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Asserting Food Sovereign
The perspective that self-sufilcjency the is besi food security policy is shared by many developed countries like Japan, Not only is it a cost KoreaandNorway. way to feedthe population, is it efficient in with alsoa practical approach dealing in uncetainties supplyand pricesin the may \.,orldmarket. Uncertainties be caused by war or variouscrisesevenduring peacelime suchas ecological drastic or demand supply. and changes global in lr3l reliance on ln timesof war,for instance, foodimportation impede countiy lrlay the to deiermine allegiance its basedon an policy. foreign independent oftheregr,ne Sadly, however because underthe of globaltradeliberalization suchasfie WTO,Third world countries to on Philippines notallowed talre such are perspective. WorLd Third countries held are hoslage the food and agibu\inessof to fo. TNCS serve markets the l\-'C food to as producls, theprocess in erodin-q selftheir suffi ciency sovereignr-'-. and Foodsecuriqis oneofthe legitimate policy, "non-h-ade" concems agricultural of to according lhe FAO andthe tr/orld Food thar rhe AoA summit.This alsomeans should be in harmon! with human and hunger reduction developmenl programs governments. praciice, ln of AoA is onlyconcemed how with however, ro applythedisciplines ofrhe wTo. And has experience shownrhar agricultural has the tradeliberalization only aggravated paitern local trade andthreatencd colonial production people's livelihoodand It is in this sensethat peasant (The movements La Via Canrpesina like Peasant Way.an inteflrationalassociation theglobe) Kilusang and ofpeasanis round Magbubukidng Pilipinas (Peasant a Movement ofthe Philippincs. national peasanl organizationt are alliance of

ro baftling rale andpushtheWTO out of agicultue to assert foodsovereignty. The concepiof food sovereignty emphasizes centrality naiional ihe {f decision-mal'ing struciures detemining in foodandagricultural policy.Tberole for n-ade this sirateg/ is left up to national in ratherthan to international eo\'ernment Food sovereignty the right of is peoples define to iheilownagricultural and food policies, io protect and regulate domestic agricultural produciion lrade and in order to achieve sustainable development objectives, ro determine and rhe exrenr whichtheywanito be selfro reliant, longasforcign As corporations and local eliies continueto be the sole benefi ciaries so-called of agricultural and food policies, food sovereignty not is achieved. Nor until the ientacles of monopolies are cut, therefore, food sovereignty remains dream. a For the Filipino people, solutionro povert), hunger and still revolves around the issuesof genuineland reforn and breakins shackles the monopoly offoreign control. Onlyby changingbackward a and coLonial economvto industrialized an and sovereign shallequitable one dlsiribution possible. of rveallh aDdincomebecome Only thencan food be available ail. for Onlythen shallthe Fjlipinopeople lree be fiom hunger

I5 & 3I

D E C E M B E R2 O O I

t3

dtruLJiqwJ

EqchFilipino Owes P31,000
appropriated debt service, for by of : automaticatly iguresrecenttyreteased the Bureau of showthat the country's the Treasury : Forthe first sevenmonths 2001,debt service to bitLion. P2.352 : amounted P157.74 debt hasreached outstanding totaL Thismeans spending vitaLsociaL less for Table). trill.ionasof Octoberlast year (See : and housing. popu- : services suchashealth,education 76 mitUon estimated Giventhe country's : Andfor the poor,it means lessaccess these to has that everyFiUpino a debt lation,this means vitatservices. : of P31,000. . has its Thegovernment to reassess prioriacborrowing 0f thi5amount,domestic on ties andre-focus what is reattyimportant: or of for bittion 52.03% the total : counts P'1,22 : grewstightty P1.'128 the wetfareof its peopleratherthan the to loans debtwhiteforeign of creditors. satisfaction the country's of biltionor 47,97% the totat. JosephS.'/u P360.2 nationat budget, Under 2002 the is of total budget. : bittion, 46.1%, the P780.8 or

Total l. Domestic A. DirectLoans Securities 1. Government agencies 2, Availed by B. Assumed Loans ll. Foreign A. DirectLoans by a. Avaited agencies b. Retent GOCCS to B.Assumed Loans Denominated Loans C. Foreign

1,224,196 1,207,321 1,192,001 15,320 16,875 1,128,548 656,907 567,O25 89,882 11,845 459,796

2,163,404 1,010,111 1,00J,601 992,038 15,563 27,510 1,133,293 686,011 588,456 13,967 433,315

fub|bhtdlodiighi'b'l'o[rodh4 Moiih. r'noiroddFi ediloF@ibon @ tur. N4. 13 ?7 37,713 27 ?e ood 7r3 0e r? (ciedioilForTr6 0r 0s Fnhcd todnisr ts tid!rq5 nqir nqd€

rlox Fdrd"d',

!'a ho& rie . shr5 r

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IBON Facts & Figures

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