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Antonio Contreras, Ph.D.

August 2006

“The views expressed in this report are strictly those of the authors and do not necessarily reflect those of
the United States Agency for International Development (USAID) and the Ateneo de Manila University”.

This study inquires into the different issues that confront the upland agriculture sector in
the Philippines. It analyzes the impacts of State policies and programs in agriculture and
natural resources on the sector, and evaluates these in the light of how they enable or
retard poverty alleviation, agricultural sustainability and global competitiveness. The
study finds that necessary interventions for the attainment of these objectives are
concretely defining and characterizing the economic and institutional dimensions of the
uplands as a complex agro-ecological zone, including the appropriate valuation of its
resources and contribution to national economy; reorienting institutional mechanisms by
which bureaucracies operate in the uplands; and institutionalizing partnerships in support
of the convergence agenda. On the other hand, sufficient conditions for realizing the
desired goals are promoting industrialization in the uplands with a strong support system
for marginalized communities, providing stronger usufruct rights not limited to the
issuance of titles, adopting the principle of environmental payments through the charging
of user fees on environmental services, providing adequate support services and safety
nets to upland farmers and enabling them to become active players in developing upland
agroforestry based industries.
Issues and Directions towards Poverty Alleviation,
Agricultural Sustainability and
Global Competitiveness

Antonio P. Contreras, Ph.D.

De La Salle University

Introduction: The State of Upland Agriculture

in the Philippines

From only 51 million in 1980, the population of the Philippines has grown to 81 million
in 2000 after only 20 years, and is expected to rise to 113 million in 2020. In 2000, 5.2
million families were considered to be poor, accounting to about 34.2% of all families.
At 47.4%, the incidence of poverty was higher for rural families compared to their urban
counterpart, which amounted to 20.4% (NSCB, 2004). About 40% of the total
population belongs to households which are dependent on agriculture. These same
households constitute about two-thirds of the poor (World Bank, 2001). In 1988, it was
estimated that 17.8 million live in the rural uplands, majority of which are poor (Cruz et
al, 1988). At the time, this was about 30 percent of the total population of the country.
Though dependence on agricultural cultivation has since been complemented by off-farm
sources of income in many areas, a significant majority of upland households derive their
main sources of livelihoods from land-based activities. Majority of these lands, which by
law are considered as public lands under the jurisdiction of the State, are of marginal
productivity. Recent estimates show that these lands considered as arable yet are in the
public domain constitute about 3.2 million hectares, which is about one-fifth of the total
15.8 million hectares considered as forest lands. Earlier estimates using slope as
reference placed the figure of lands suitable for agriculture 1 within the public domain at
57 percent of the total forest lands (Cruz et al, 1988), which at current figures would be
close to 9 million hectares. This is almost equal to the total area of agricultural lands
which are not considered as forest lands, which stands at around 10 million hectares as of
2000 (See Table 1), and is about a third of the total land area of the Philippines.

Thus, we have a significant number of Filipinos living on a large portion of our territory
living below the poverty threshold and eking out a living from a resource that is both
marginal in productivity and of which they may have access but have no control. This is
the picture that confronts us as we inquire into the future of upland agriculture in the
Philippines. This is juxtaposed with a vision provided by RA 8435, otherwise known as
the “The Agriculture and Fisheries Modernization Act of 1997,” (AFMA) which
mandates a policy regime that would bring Philippine agriculture to a state where poverty

This is determined using simple slope classification, wherein arable lands are computed as lands with
slopes not to exceed 30 percent.

has been alleviated and agricultural production has become sustainable and globally

Table 1. Physical area of agricultural land by utilization, 1996-2000 (in ‘000 ha)

Type of Farm 1996 1997 1998 1999 2000

Under 5540 5573 5605 5635 5663
Temporary Crops
Temporary Fallow 31 26 22 19 16
Under Permanent 4293 4310 4326 4341 4355
Temporary Meadows 37 31 26 22 19
and Pastures
Permanent Meadows 66 57 50 43 38
and Pastures
Woodlands and Forest 33 28 24 20 18
Homelot 50 48 46 44 42
Others 41 39 37 36 34
Total 10091 10114 10137 10161 10184
Source: NSCB, State of the Philippine Land and Soil Resources, 2003

This paper inquires into the different issues that confront the upland agriculture sector in
the Philippines. It analyzes the impacts of State policies and programs in agriculture and
in natural resources vis-à-vis this sector, and evaluates these in the light of how they
enable or retard the attainment of the policy vision of poverty alleviation, agricultural
sustainability, and global competitiveness. It also proposes policy options and directions
which need to be explored or taken to enhance the attainment of such vision.

Programs and Policies of the State vis-à-vis Upland Agriculture:

Impacts and Issues

Impacts and Issues vis-à-vis Governance of the Uplands. The uplands, as a geographical
space, has been defined by the government as referring to marginal lands with at least 18
percent slope, lands that fall within mountain zones including plateaus lying in high
elevations, and lands with hilly and mountainous terrains (BFD, 1982). However, the
technical definition of what constitutes the uplands has been the object of academic
debate. There are attempts to differentiate the uplands from hilly lands and highlands,
with uplands being only those with 18 percent in slope, while highlands are those that fall
in high elevations, regardless of whether they have slopes 18 percent or higher. On the
other hand, Raymundo (1984) offers a definition of hilly land as:

“…an area at least one sq. kilometer (100 hectares) of which 70 percent of the
land forms have more than 15 % slope gradient; or a maximum 30 percent of the
land forms have less than 15 % slope gradient and with no contiguous level (≤
15% slope gradient) area of more than 10 hectares.”

While this attempt to have finer distinctions may sound academic, it has bureaucratic
implications. Clearly, in this differentiation, some types of uplands are now limited to
lands above 18 percent in slope. This definition coincides with the legal definition of
public lands, as specified in PD 705, or the Forestry Reform Code of 1975. As such, these
lands are considered in the public domain, and are now placed under the administrative
jurisdiction of the then Bureau of Forest Development (BFD), and has since been
renamed as the Forest Management Bureau (FMB) of the Department of Environment
and Natural Resources (DENR). Public lands, which include both forest lands and areas
that are suitable for agriculture, constitute about 53 percent of the total land area of the
country. Lands falling in this category could not be declared alienable and disposable (A
and D), and those that have been declared as A and D will have to be reverted back to
forest lands. On the other hand, a significant portion of hilly lands and highlands,
particularly those which fall below 18 percent in slope, are now considered as A and D,
the administrative jurisdiction of which now belongs to the Department of Agriculture
(DA), the Local Government Units (LGUs) and the Department of Agrarian Reform
(DAR). A and D lands constitute roughly 47 percent of the total land area (See Table 2).
Also included in this category would be lands with slopes above 18 percent in slope but
have been already titled prior to the passage of PD 705. However, these lands are subject
to pertinent provisions of PD 705, specifically Section 15, which states:

Lands eighteen percent (18%) in slope or over which have already been declared
as alienable and disposable shall be reverted to the classification of forest lands
by the Department Head, to form part of the forest reserves, unless they are
already covered by existing titles, approved public land application, or actually
occupied openly, continuously, adversely and publicly for a period of not less
than thirty (30) years as of the effectivity of this Code, where the occupant is
qualified for a free patent under the Public Land Act. Provided, that said lands,
which are not yet part of a well-established communities, shall be kept in a
vegetative condition sufficient to prevent erosion and adverse effects on the
lowlands and streams. Provided, further, that when public interest so requires,
steps shall be taken to expropriate, cancel defective titles, reject public land
application, or eject occupants thereof.

Thus, the territory called “uplands” assumes a bureaucratic identity that straddles several
government agencies. While a portion of the uplands under the jurisdiction of DENR are
suitable for agriculture, such are managed in the context of PD 705 and its attendant and
succeeding related policy issuances and directives. This policy climate puts emphasis on
conservation, and while there may be references on upland farming, these are seen as
secondary activities compared to the primary function of watershed protection and
rehabilitation through appropriate land uses. A perusal of most DENR policy
pronouncements on the uplands vis-à-vis its farming systems focus on incentive systems,
such as provision of tenurial security in the form of usufruct rights given usually to

collective entities, to engage in agroforestry activities in support of forest protection and

resource rehabilitation.

Table 2. Status of Land Classification by Region (in hectares)

Region Total Land Area Alienable and Total Forest Land

Disposable Land

Philippines 30,000,000 14,145,078 15,854,922

National Capital Region 63,600 48,232 15,368
CAR 1,829,368 350,099 1,479,269
Ilocos 1,284,019 810,922 473,097
Cagayan Valley 2,683,758 965,965 1,717,793
Central Luzon 1,823,082 1,051,908 771,174
Southern Tagalog 4,692,416 2,172,866 2,519,550
Bicol 1,763,249 1,222,060 541,189
Western Visayas 2,022,311 1,408,782 613,529
Central Visayas 1,495,142 959,223 535,919
Eastern Visayas 2,143,169 1,023,715 1,119,454
Western Mindanao 1,599,734 762,280 837,454
Northern Mindanao 1,403,293 657,100 746,193
Southern Mindanao 2,714,059 1,079,824 1,634,235
Central Mindanao 1,437,274 546,828 890,446
Caraga 1,884,697 542,447 1,342,250
ARMM 1,160,829 542,827 618,002
Source: NAMRIA

A closer examination of the discourse of the State vis-à-vis upland agriculture reveals a
punitive origin, wherein upland cultivation was seen as mainly destructive in character,
and has to be punished, prohibited and controlled. This view was premised on the legal
principle that all forest lands, including those that are suited for agriculture and/or being
cultivated, are public lands owned by the State, as well as on the argument that upland
cultivation was destructive, as symbolized by “slash and burn” agriculture. Later policies
and programs have gradually accommodated upland cultivation, but subject to much
State regulation and control. In 1975, the Forest Occupancy Management (FOM)
program awarded occupancy permits to upland farmers on the condition that they would
not expand their cultivated areas and they would conduct forest protection activities
prescribed by government. Two succeeding programs, the Communal Tree Farming
(CTF) Program in 1978 and the Family Approach to Reforestation (FAR) Program in
1979, provided mechanisms for upland farmers to establish tree plantations. In 1982,
Letter of Instruction (LOI) 1260 issued by President Ferdinand Marcos established the
Integrated Social Forestry Program (ISFP), wherein tenurial rights good for 25 years and
renewable for 25 years were awarded to communities and individuals provided that they
engage in forest protection activities and adopt soil conserving techniques in upland
agriculture. Succeeding community-based programs, such as those initiated under

Department Administrative Order (DAO) No. 39 issued in 1988 establishing a

nationwide reforestation program, and DAO No. 123 issued in 1989 creating the
Community Forestry Program (CFP) have even placed more emphasis on resource
conservation, even as they also provided some mechanisms for allowing some forms of
upland agriculture, now in the form of agroforestry. Executive Order (EO) 263, which
took effect in 1995, institutionalized community-based forest management (CBFM) as
state policy. As shown in Table 3, there is a substantial shift in the management system
of public lands away from corporate timber production through Timber Licensee
Agreements (TLA) to people-oriented forestry programs (POFP) through CBFM, the
Integrated Social Forestry Program (ISFP) and forest land management agreements
(FLMA). In 1990, TLA areas accounted for 3.7 million hectares while only half a
million hectares were devoted to CBFM and other people-oriented forestland
management systems. Ten years after, and after EO 263 took effect, the area devoted to
TLA was reduced to only about 0.9 million hectares, while there was a significant
increase in the area devoted to POFP, which stood at 5.7 million hectares.

Table 3. Forest area under different management systems (in ‘000 ha).

National Forest Programs/Access YEAR

Systems 1990 2000
TLA 3,762.0 910.0
CBFM/ISFP/FLMA (POFP) 596.3 5,708.4
IFMA/ITPLA/JV/CP/PS 304.0 548.0
Pasture leases/permits 413.6 122.0
SIFMA - 22.4
TFL 13.0 19.0
AFL 110.0 91.0
Forest Reserve/Reservations 3,644.7 3,644.7
National Parks/Protected Areas 1,341.0 893.2
Fishpond 75.5 75.5
Areas under formal mgt 10,260.1 12,034.2
Open Access 5,622.2 3,820.7
Total Forest lands 15,882.3 15,854.9
Source: FMB

The implementation of these community-oriented policies in forest management, while

effective in turning around the punitive discourse against upland farming into a more
participative and development-oriented mode, has nevertheless failed to engage upland
agriculture as a viable sector in the environment and natural resource policy arena. The
number of beneficiaries from the program, in terms of households and people’s
organizations is indeed significant, as shown in Table 4. CBFM projects involved about
496,000 households organized into 2,182 people’s organizations. However, evidences
from field studies conducted indicate a mixed picture, wherein community forestry was

able to build forest community institutions and organizations for forest protection in some
areas even as it failed in others, while at the same time not being able to provide
communities with sustainable livelihood systems drawn from both forest utilization and
agricultural cultivation (Contreras, 2003). The bureaucratic culture of DENR is unable to
engage the uplands as an agricultural land base. This is expected since its main mandate
is resource conservation and not food production. DENR focuses on conservation, but
has yet to implement a comprehensive approach to enhancing upland agricultural
productivity through crops cultivation and livestock production.

Table 4. CBFM Projects (as of December, 2002)

No. of Sites Project Area Tenured No. of HH No. of

Region in ‘000 Ha Area In ‘000 POs
In ‘000 Ha
CAR 424 700.5 677.6 13.6 39
1 278 95.9 83.1 22.3 241
2 136 799.6 630.2 63.9 97
3 249 239.0 203.4 38.5 229
4A 70 42.4 22.3 3.6 57
4B 113 805.9 518.9 26.6 84
5 262 187.9 169.9 24.1 132
6 322 156.2 47.9 73.2 206
7 314 69.1 49.2 45.5 259
8 215 239.3 94.2 14.1 93
9 673 426.1 200.8 31.2 293
10 431 470.8 369.3 36.4 172
11 603 516.5 508.5 63.6 160
12 334 388.3 349.7 23.6 41
13 483 553.5 456.0 14.4 72
ARMM 49 17.4 14.5 1.4 7
TOTAL 4,956 5,708.4 4,395.5 496.0 2,182
Source: FMB

The agency which is supposed to address this issue is DA. Unfortunately, while upland
agriculture is widespread in hilly lands and highland areas not declared as part of the
public domain, the DA has yet to fully articulate a well-defined upland agenda. This is
because its policy discourse is driven by the language of “commodities” wherein the
dominant units of planning and policy imaging are crops and not land spaces. It is telling
that in the 120 sections of AFMA, there is no single reference to upland agriculture. In
Section 17 of AFMA, in which areas of concerns for the preparation of the Agriculture
and Fisheries Modernization Plan (AFMP) were listed, upland farmers were not included,
while senior citizens, handicapped persons, rural youth and indigenous peoples, among
others, were included. While one can argue that upland farmers can be a crosscutting
category, its marked absence in the list of identified sectors and areas, and the apparent
silence of AFMA on the case of upland agriculture, are too pronounced not to be noticed.

This is also evident in the marked absence of data on the actual contribution of upland
agriculture to national agricultural productivity, and to GDP and GNP. It is also seen in
the weak institutional linkages between DA and the upland communities and the civil
society organizations that attend to their interests. A close perusal of the projects of the
DA targeting the uplands, most of which are foreign assisted, is characterized by a
minimal presence, if not pronounced absence, of mechanisms to foster partnerships with
civil society organizations.

Other agencies which provide support services to some areas in the uplands include DAR
and the LGUs. DAR is tasked to lead the effective implementation and management of
land reform in the county, through the provision of support services for the integrated
development of landless farmers, farm workers, and small landowner-cultivators, which
include farmers in upland areas. The agency is also responsible for the issuance of titles
to, the recognition and development of ancestral domains of, and the facilitation of
culture based-development of indigenous communities and people, majority of which
reside in the uplands. Both DAR and the LGUs, together with other government
agencies, are identified in AFMA as major partners in the development and operation of
Strategic Agricultural and Fisheries Development Zones (SAFDZs), which include
Agrarian Reform Communities (ARCs).

The multiplicity of institutional actors and of definitions makes the uplands a territory the
needs of which are very problematic for state power to fully address in its current
bureaucratic set up. This compounds the problem of fit between the current bureaucratic
system with the ecological and productive aspects of the uplands. By virtue of the
topography and the existing resource base and configuration, the uplands demand
appropriate conservation measures to combat soil erosion, protect the watersheds and
promote biodiversity. This is fully addressed by the environmental protection agenda
espoused by DENR in areas within the public domain that are currently cultivated.
However, the marginal economic conditions of the communities demand that their
livelihood activities be sustainable and viable and that their community institutions are
organized. Here, DENR is able to mobilize social capital of civil society groups, as well
as build it internally within the upland communities themselves, through the various
POFP activities. However, it is finding difficulty to translate this into sustainable
livelihoods and viable agricultural systems.

The DA is ideally in the best position to address the technical needs of upland agriculture,
as it is the government agency mandated to provide technical support for agricultural
activities. However, most of the uplands are not within its jurisdiction. Furthermore, and
even in those types of uplands within its area of responsibility, such as hilly lands and
highlands, it is unable to provide a systematic and comprehensive upland support
program due to its focus on crops, and its commodity-centered planning horizon that
limits its capacity to fully capture the complexity and dynamism of upland agricultural
systems. A focus on commodities also naturally leads to a bias in favor of single-crop
regimes that can have some adverse impacts to biodiversity, ecosystem health and soil
and water quality. The interventions and mediations of DAR and the LGUs have also

this limitation, considering that the policy instrument within which they operate, which is
the AFMA, is crafted using the commodity framework.

Thus, to fully harness the potential of the uplands as an agricultural sector, the
reorientation, synchronization and convergence of the bureaucratic systems, policies and
program perspectives of DENR, DA, DAR and the LGUs become an imperative.

Impacts and Issues vis-à-vis The Uplands as a Domain of Economic Activity. AFMA’s
potency rests on its three objectives of poverty alleviation, sustainable agriculture, and
global competitiveness. It is against these three goals that one should examine current
efforts in upland agriculture. In order to do this, one has to inquire into the viability of
the upland economy. As earlier pointed out, there is no data on the percent contribution
of the upland economy to the national income accounts. Income analysis are at best
provided by field studies, but are not translated to aggregate national figures.
Nevertheless, there is a preponderance of documented evidence to show that the upland
economy is characterized by relatively high incidence of poverty in which a big majority
of households live on subsistence income. This is due to the marginal productivity of
lands, which are prone to erosion. Since majority of upland areas fall within public lands,
such are held by farmers mostly by virtue of usufruct rights granted by government
through the various incarnations of POFP, such as CBFM. Data gathered in a study
conducted in Bukidnon validates the fact that upland farmers are generally price takers,
and changes in supply at the site have no significant effect on commodity prices, thereby
rendering them hostage to national markets and to middlepersons (Coxhead et al, 2005).

Upland poverty is a well perceived phenomenon. Numerous field studies have been
conducted documenting its prevalence. In Mindoro, for example, the per capita income
in 1997 among upland families is 8,709 which is below the poverty threshold for the
region at 12,492. However, the preponderance of local case studies is not translated into
an aggregate figure that would account for the relative existence of upland poverty vis-à-
vis other sectors. Most of the existing figures are at best extrapolations from reference
variables, and not as actual direct measures. This largely stems from the absence of an
effort to distinguish upland economic activity from other sectors of the economy in
general, and of agriculture in particular, in statistical data bases. The best effort so far in
statistical reporting is the attempt to segregate the area and value of palay production in
rainfed areas from irrigated areas (See Table 5). However, this is not a valid measure
since while a big majority of upland areas are rainfed, it is not safe to conclude that all
rainfed areas are upland areas. 2 This is unfortunate considering that upland agriculture
may in fact account for a significant number of the perceived recipients of interventions
as mandated by AFMA.

The data for palay production until 1999 published in the website of the Philippine Institute of
Development Studies (PIDS) which was taken from the Bureau of Agricultural Statistics (BAS) indicates a
further desegregation of upland areas from rainfed areas. It was the data in the BAS database starting 2000
wherein production and area devoted to upland palay was apparently integrated with the figures for rainfed
areas. In 1999, the area planted to upland palay is only 54,081 hectares while the rainfed area planted to
palay is 1,281,129.

Table 5. Palay Production in terms of area and value, by type of water source

Year Irrigated Rainfed

Area (hectares) Production Area (hectares) Production
(metric tons) (metric tons)
2005 2,791,721 11,233,793 1,278,700 3,269,212
2004 2,792,196 10,941,836 1,334,449 3,594,948
2003 2,718,538 10,250,223 1,287,883 3,249,661
2002 2,706,298 9,949,173 1,340,020 3,321,480
2001 2,726,876 9,790,260 1,338,565 3,164,610
2000 2,703,354 9,412,676 1,334,731 2,976,736
Source: Bureau of Agricultural Statistics

The framers of Philippine Agriculture (PA) 2020, a document in its final drafting stage
commissioned by the National Academy of Science and Technology (NAST), identify
key policy principles that would support the implementation of AFMA and would
address directly the issue of upland poverty. One of these is the push to organize and
manage agriculture as a business. This would entail the transformation of subsistence
farmers into entrepreneurs, and of products and markets for higher value. Improving the
efficiency of the supply chain and clustering of agriculture-based industries in such a way
that linkages between primary production, input suppliers and processors will be
strengthened are also key strategies being suggested to achieve this. A policy principle
being forwarded to alleviate poverty specifically in the uplands is through asset reform.
This can be done by awarding private titles to production forests and CBFM areas.

Privatization of upland farms is premised on the argument that if farmers own the land
they cultivate, that they would have incentives to minimize environmental damage.
There is a belief that the current practice wherein only usufruct rights are given, and
mostly to collectives such as community organizations, fails to provide a sense of
security to the farmer enough to enable him to adopt more aggressively sustainable land
conservation practices. Indeed, field studies show that farmers with more secure tenure
tend to adopt conservation practices more. However, the same studies also show that
while providing tenurial security is a necessary condition for environmentally sound
farming practices, it is not a sufficient condition. In Bukidnon, it has been observed that
low profitability of upland farming has motivated tenured farm owners to lease their
lands to third parties who are engaged in the more profitable but more environmentally
unsound activity of commercial crop production. Aside from low profitability, other
factors that were found to influence decision to lease lands to short-term cropping are age
and availability of non-farm income (Dumayas et al, 2003).

The decision of tenured upland farmers to lease lands to third parties is undoubtedly
driven by higher income opportunities. In fact, in areas where there are no available third
parties, upland farmers are drawn to off-farm income sources in lieu of upland
cultivation. In a study conducted in Davao Oriental, 55 percent of the income of the
community came from off-farm sources while only 35 percent came from agricultural

harvest (Morales et al, 2003). In Mindoro, income from forest and agricultural activity
accounted for only 31 percent while income from private employment constitutes 48
percent (Paunlagui et al, 2003a). In these cases, the availability of off-farm employment
may lead to a reduction in agricultural activity even as it increases household income. In
situations wherein the crops foregone are environmentally degrading, such as corn and
vegetables, the presence of off-farm employment may also provide the needed push for
conservation practices. Rola et al (2002) suggests that an increase in the opportunity cost
of farm labor (as brought upon by higher off-farm labor opportunities) may lead to a
reduction in labor-intensive cultivation methods. However, this may also lead to a
reduction in labor-intensive soil conservation practices, which may jeopardize
conservation activities. Findings from field studies in Bukidnon indicate that off-farm
employment may indeed enable environmental improvements. However, this is still
contingent on the appropriate agricultural and environmental policies.

The ideal situation is to tap the profit-seeking behavior of upland farmers and translate
this into a motivation to adopt sustainable farming practices that are also profitable and
may even make them globally competitive. One possible policy alternative that has been
forwarded is to use market-based mechanisms to induce farmers to shift from labor-
intensive and environment-degrading farming practices and adopt more sustainable and
efficient technologies. This would also constrain them to expand into ecologically fragile
areas, and motivate them to move to more productive areas. This could take the form of
economic liberalization.

However, adoption of market-based policy instruments, such as trade liberalization, to

induce farmers to shift to ecologically sound upland farming practices, while at the same
time promoting their transformation into business entrepreneurs, will likely have some
short-term adverse impacts on livelihoods, and may in fact aggravate upland poverty. To
alleviate poverty, one also has to ensure sustainability of the agricultural production
system. Studies show that upland conservation rests on arresting soil erosion and
protecting the watershed. However, this would entail controlling for production systems
that are yielding higher incomes for farmers. For example, corn and vegetable farming in
Bukidnon, the key crops of upland farmers, are highly erosive and are therefore
unsustainable. Trade liberalization policies may in fact have environmentally beneficial
impacts, as it may drive down the price of corn and vegetables, and will cause a reduction
in the area devoted to these crops (Coxhead et al, 2005). However, this may also
compromise the income of households. Shiveley and Zelek (2001) point out that policies
that promote ecological sustainability (marked by reduction in soil erosion and in the use
of chemicals) tend to reduce household income, or are costly for local governments.

It is therefore apparent that the attainment of the goals of AFMA is constrained by the
economic complexity of the uplands, wherein no single policy intervention can bring
about the desired results. Policies to alleviate poverty, promote agricultural sustainability
and enable upland farmers to be globally competitive require structural transformations in
the modes of production and exchange. Short-term adverse impacts on income levels,
while expected effects of radical restructuring, such as the removal of tariff barriers on

crops such as corn and vegetables, will have to be socially addressed by a combination of
programs and policies that would provide safety nets to already marginal communities.

Recommendations to Reform Policy and Practice

The present policy climate of DENR, through POFP, while promoting conservation and
institution building, is not sufficient to address the issue of poverty and agricultural
productivity. On the other hand, the policy thrusts of DA (and by extension, DAR and
the LGUs) which is the prime mover for AFMA, falls short of the ecological
requirements of the uplands, and espouses a “commodity” framework that does not
position the uplands for a coherent policy treatment. It is in this context that there is a
need for policy reform.

The fundamental step is to redefine more precisely what constitutes the uplands, and to
redesign the bureaucratic mechanisms by which such are governed. There is a need to
recognize the multiplicity of upland farming systems in terms of social structure and
political-ecological dynamics. Clearly, there are two types of uplands vis-à-vis
jurisdictional responsibility: those that are within public lands and are therefore under the
control of DENR; and hilly lands, highlands and areas above 18 percent in slope but are
not declared public lands which are under the area of manageable interest of DA, and by
extension, of DAR and the relevant Local Government Units (LGUs). In terms of
production systems, the uplands consist of areas that are planted to single crops (either
annuals or to more permanent crops), or are devoted to multiple-cropping as agroforestry
farms. There are also upland areas wherein farming is still the dominant mode of
production, and areas in which it is now secondary to non-farm and off-farm income
sources. An effort to map out these areas, and to characterize their economic and
institutional dimensions is an imperative prerequisite for any meaningful policy
intervention to be crafted. Efforts must be exerted to quantify the contribution of the
uplands to the national economy, and to desegregate upland socio-economic data from
the aggregate data, using appropriate valuation techniques to truly reflect their scarcity.

Institutionally, the “undocumented” status of the uplands is aggravated by the artificial

jurisdictional divisions that seriously undermine an integrated and comprehensive policy
formulation and implementation. As discussed earlier, DENR and DA approach the
upland problem from two different and opposite perspectives. DENR considers the
uplands more as a resource to be conserved, and is unable to bring about a coherent
agenda for upland agriculture. On the other hand, DA, while seemingly aware of the
existence of a kind of agriculture that is labeled as “upland,” is unable to translate this
into a spatial concept in policy terms. It is constrained by its traditional focus on crops
and commodities. There is a need now to integrate the systems and approaches that
address the uplands, and to look at the uplands as an ecological zone for policy formation
and articulation outside the bureaucratic boundaries drawn by State institutions.

One of the key recommendations by the drafters of PA 2020 is to translate into policy the
principle of agriculture as a cultural construct and a way of life. One of the better ways

to operationalize this is by recognizing the vitality and dynamism of the uplands as a

distinct agro-ecological zone. The greater challenge is for the agricultural development
cluster, which include DA, DAR and the agricultural units of the LGUs, to go beyond
their “commodity orientation” and to begin to seriously operationalize a farming systems
approach to the uplands. They have to re-engineer their activities away from their
traditional boundaries, and make agroforestry a distinct area of concern that cuts across

To enable further convergence, there is a need to institutionalize the integration of DA,

DENR, DAR and the LGUs vis-à-vis upland agriculture and community based forest
management. There is a need to harmonize the policy instruments, program directions
and practices. These can be achieved initially through multi-agency partnerships, as what
is now being initiated among DENR, DA, and DAR when they jointly issued Joint
Memorandum Circular No. 1 on 26 January 1999 creating an inter-departmental steering
committee and technical working group for the application and monitoring of a common
sustainable rural development framework. Such effort has been reactivated through Joint
Memorandum Circular No. 1, dated 18 October 2004, which set the guidelines for the
operationalization of the convergence. Available documents relevant to the convergence
efforts indicate the key result areas to include poverty alleviation and sustainable
agriculture and fisheries with the goal of attaining food security, increase the food
supply, generate employment and increase the gross value of the sectors concerned. The
strategies include sourcing and developing appropriate technologies, accessing markets
and establishing processing facilities, mobilizing massive financial resources, upgrading
people capabilities and re-aligning government and private institutional commitments. A
more detailed implementing instrument spelling out the strategies has yet to be issued,
but pilot sites have already been identified.

Beyond convergence, the more radical proposal which this paper proposes is to elevate
CBFM as a cross-cutting program that could either be jointly managed by DENR and
DA, or be an independent council with its own corporate and legal personality, like a
National Council for Upland Development. This would require an enabling law, and
would entail a restructuring of the current activities and organizational set-up of DA and
DENR. Though radical, this is justified by the fact that the uplands is a vast territory that
is home to the most economically and politically marginalized sectors, even as it also
provides an enormous potential for employment and value creation. Its complexity
requires a multidisciplinary and novel approach. Aside from DENR, DA, and DAR,
other agencies of government such as LGUs and the DOH, DPWH, DOST and DepED,
among others, have to be brought in. Past efforts to address multi-faceted issues using a
Departmental anchor have proven to be still held captive by bureaucratic limitations and
traditional biases. Going beyond departmental boundaries, and housing the issues in an
independent council or commission with its own legal and bureaucratic personality and
mandate, have achieved greater results. Examples of these are the National Commission
on the Role of Filipino Women (NCRFW) and the National Commission of Indigenous
Peoples (NCIP).

Beyond structures, however, there is also the equally crucial need for appropriate
economic and land-use policies to promote upland productivity without jeopardizing the
environment. There is a need to provide farmers with incentives to move to crops that
are not erosive, even as safety nets for farmers, such as credit availability, adequate
infrastructure, and enabling support institutions are provided.

Studies indicate that the more appropriate farming system in the uplands is agroforestry
in tandem with the adoption of sloping agricultural land techniques that take into account
soil and water conservation measures. Agroforestry generally refers to the management
of forestlands which increases their productivity by combining forest trees and
agricultural crops (annual, biennial and perennial crops) including livestock
simultaneously or sequentially over time through the application of appropriate
management practices. DENR has issued an order in 2005, DAO 25, which seeks to
provide guidelines for the implementation of an upland agroforestry program in the
Philippines. Specifically, the program aims:

• To reduce rural poverty by increasing productivity and employment in the

uplands through the development of upland agroforestry farms and plantations
• To enhance forest cover of forest lands by planting economically beneficial crops
in addition to timber species;
• To ensure sufficient supply of agricultural and fruit tree crops through private-
public participation and by encouraging all sectors to engage in the development
of agroforestry farms and plantations; and
• To improve the economic well-being of upland people and communities
dependent on forest lands and forest resources by ensuring equitable opportunities
and access to forestlands and forest resources.

The program seeks to cover a minimum of 4 million hectares of open and unproductive
lands within the public domain, which include cultivated areas, shrub lands, wooded
grasslands and grasslands. This also includes the 1.9 million hectares currently covered
by CBFM agreements and is earmarked for agroforestry development, as well as
forestlands used for other purposes such as grazing lands.

A close perusal of the provision of DAO 25 reveals that the program prefers corporate
groups (corporations, NGOs, associations, cooperatives, organizations and LGUs) with
established track records in forest development, agroforestry, agribusiness and other
related business activities, and which are financially capable to undertake agroforestry
development. While individuals may also qualify, they have to be members of
recognized corporate groups and must show evidence of financial and technical capacity
to undertake agroforestry development.

The development of agroforestry farms and plantations may promote the creation of
employment opportunities and increase the value added of the uplands, even as it fosters
resource conservation. However, it can also lead to the further marginalization of the
poor and unorganized upland farmer. While corporate agroforestry is a welcome

development, measures should be installed to level the field in favor or disadvantaged

and unorganized farmers. Adequate safety nets should be in place to ensure competitive
wages for farmer-laborers. Furthermore, a more liberal window for loans should be made
available to people’s organizations and other community-based groups who would like to
avail of the program. In addition to DENR and the LGUs, which are tasked to provide
technical assistance as stipulated in DAO 25, the DA should be actively involved,
particularly on matters pertinent to agricultural production. DAO 25 should be revised to
accommodate the involvement of DA, which is a party in interest but has not been
recruited to become a partner in the endeavor. It is in activities like these that adequate
and appropriate inter-agency linkages and partnerships concerned agencies become

The issue of land tenure has been identified as a crucial concern. In fact, the drafters of
PA 2020 boldly propose the titling of upland production areas. As pointed out by many
studies, and as discussed above, security of tenure is a necessary but not a sufficient
factor. Evidence from the field suggests that what matters most are the institutional
support mechanisms that would enable the holder of tenurial rights to optimize the use of
the resource of which such rights are held. Granting tenurial rights, such as private titles,
to lands which are marginally productive may in fact pressure the holder to abandon such
land in favor of non-farm activities. In situations where this would lead to a fallow
period, and where the opportunity cost of tilling the land vis-à-vis off-farm employment
is high, such move may in fact have positive environmental and economic benefits.
However, the socio-economic reality of upland communities indicates that not all farmers
will be competitive in the off-farm labor markets. This may engender a relocation of the
poverty problem away from the uplands into lowland and urban areas, where they may
exacerbate the already crowded labor markets. Thus, the provision of institutional
mechanisms to provide employment opportunities to upland farmers becomes an
imperative. Industrializing the uplands, through the establishment of agroforestry farms
and plantations such as those enabled by the Upland Agroforestry Program mandated by
DAO 25, Series of 2005 may indeed provide this opportunity.

Nevertheless, releasing upland production areas for titling remain a problematic solution,
as it may lead to the privatization of the burdens that come with ecologically marginal
lands to already marginalized individuals. Giving tenure beyond usufruct rights to upland
areas with marginal resource productivity may be counterproductive, as it may only result
in further degradation and/or continued subsistence. Should this be a policy, it is
recommended that the implementation be limited to lands that will be deemed productive.
Marginally productive lands can then become areas devoted to aggressive reforestation
and land rehabilitation activities, implemented through CBFM and other POFP
interventions, or through contracted partners from the private sector that may have
interest in and the capability for long-term investments, provided that they retain
utilization rights. To address the problem of financial burden on the part of government
and the LGUs, the State may consider using a market-based mechanism, such as charging
downstream consumers a user fee on water and other environmental services, to generate
the needed funds to finance these land rehabilitation activities (Francisco, 2004). The
LGUs, in cooperation with water service providers as well as water use regulatory

agencies, may explore within the scope of the Local Government Code the possibility of
establishing local mechanisms to implement a more equitable system of water user fees,
and to ensure that the fees collected are used to rehabilitate degraded upland areas.

The use of other market-based instruments, such as trade liberalization and the lifting of
tariff barriers on agricultural crops that are environmentally degrading may become a
driver for farmers to shift to non-destructive production technologies. This, likewise,
would require the provision of adequate support mechanisms that would insulate the
farmers from the shock of reduced incomes in the short run, and provide them
opportunities for alternative on-site and off-site employment.

One of the most visible outcomes of community-based interventions in the uplands

enabled by CBFM is the development of forest-based institutions such as people’s
organizations, as well as the strengthening of social capital within and among various
groups. Evidence from field studies reveals that strong social capital, in combination
with other variables such as dependence on the resource and the presence of strong
organizations, enables resource conservation (Contreras, 2003). Paunlagui et al (2003b)
found out that social capital has a positive relationship with eco-governance, and is
higher in areas where soil productivity is perceived to be higher. It is in this context that
there is value in adopting partnerships with people-based organizations and third party
civil society mediators not only in the delivery of support services and safety nets, but
also in the building of capacity of marginal farmers to be able to compete with more
organized groups in taking advantage of the new opportunities opened for investments
and for upland industrialization.

Conclusion: Summary of Policy Recommendations

The sector of upland agriculture is indeed complex, and the issues that arise from it
require creative and innovative solutions, some of which have already been articulated
through existing policies. This paper proposes the following key policy interventions that
would enable the uplands to become a template upon which the agenda of poverty
alleviation, sustainable agriculture, and global competitiveness can be realized. The first
three recommendations are considered to be necessary in bringing about such desired
outcome, and should be addressed immediately.

• Concretely define and characterize the economic and institutional dimensions of

the uplands as a complex agro-ecological zone, and valuate its resources and its
contribution to the national economy using appropriate valuation techniques
• Reorient the institutional mechanisms by which bureaucracies operate in the
context of the uplands. Agencies pursuing the agricultural development agenda,
such as DA, DAR and the LGUs should go beyond their “commodity” orientation
and recognize the uplands as a distinct space for policy and program
development. DENR should continue and strengthen its resource conservation
agenda through community-based mechanisms, even as it strengthens the

production aspects of its agroforestry-based interventions towards sustainable

• Institutionalize partnerships in support of the convergence agenda, by involving
relevant government agencies, civil society organizations and people’s
organizations, even to a point of establishing an independent National Council for
Upland Development

On the other hand, the following recommendations are needed as sufficient conditions to
fully realize the desired goals.

• Promote industrialization in the uplands through the establishment of

agroforestry-based industries, with a strong social support system for
marginalized communities
• Provide stronger usufruct rights, including but not limited to the issuance of titles,
to productive upland production areas even as marginally productive lands are
kept public and are subject to land rehabilitation activities to be undertaken within
existing POFP arrangements, or in partnerships with the private sector
• Adopt the principle of environmental payments, through the charging of user fees
on environmental services as a way of raising funds for upland rehabilitation
• Provide adequate support services and safety nets, and enable the capacity of
upland farmers to become active players in the development of upland
agroforestry based industries


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