DAVAO CITY (MindaNews / 08 April) — Mindanao’s development remains key to the Philippines’ economic progress.
But over 80% ofMindanao’s farmers and fisherfolk remain “poor or near-poor and lack scale and skills to compete” so efforts to make them more productive must be strengthened to bring growth and address poverty in Mindanao, and achieve economic progress in the Philippines, the World Bank-funded Mindanao Jobs Report (MJR) 2017 said.
Providing a comprehensive strategy to unlock the island’s potentials, the MJR said economic progress in the Philippines depends on the success of the development of Mindanao, the country’s main agricultural producer.
“Unless there is development in Mindanao, it is hard to see how the Philippines can achieve sustained and inclusive growth,” it said.
The 92-page study released on Friday emphasized the need to prioritize the development of “agriculture, forestry, and fisheries” as it employs nearly half of workers in Mindanao but noted 78 percent of the individuals with incomes below the poverty line are found in the rural areas.
Agriculture also drove 60 percent of Mindanao’s economy and employment in 2012, it said
The report found that the lack of competition in key sectors, insecure property rights, complex regulations, and severe underinvestment in infrastructure, education, and health resulted to anomalous growth pattern, leaving “majority of Mindanawons without good jobs and has led to the emigration of many talented people.”
It noted that except for a few export agricultural crops, the agriculture sector is not very productive, inadequate infrastructures limit growth of manufacturing, and agricultural workers who cannot land jobs in cities often end up in the low-productivity, low skill services sector.
It explained that improving production in Mindanao could reduce food and input prices, improve welfare, and make Philippine products more competitive.
The report’s main components are: raise agricultural productivity and improve farm-to-market connectivity; boost human development; and address drivers of conflict and fragility and build up institutions in Autonomous Region in Muslim Mindanao (ARMM).
The MJR also identified three priorities to maximize the potentials of Mindanao such as raising farm productivity through agro spatial approaches and productive alliances; building up logistics services, improving roads from fields to markets; and developing key ports and modernize custom procedures.
The report also emphasized the need to connect the rural and conflict-affected areas to cities because they serve as “conduits of rural development” since the rural areas rely on cities for food processing, marketing, and logistics support to deliver produce to other markets here and abroad.
“Better rural roads would reduce cost and product losses for poor farmers and could make a major contribution to reducing poverty,” it said.
The report suggested giving incentives to local government units to encourage them create a comprehensive rural roads plan and help them fund for these road projects to stimulate productivity and equity, and create jobs.
It said rural road investments should be targeted in remote villages in conflict-affected areas as those infrastructure projects would open up market access and make government presence more felt, which also addresses grievances that sustain insurgency.
“Furthermore, devoting resources to alternatives to road investments in the most remote areas, by investing horses, cable lines, and pathway clearing, could suffice and improve transportation,” the report said.
It added that a more centralized planning of urban road projects would better connect cities with the countryside, stating that congestions, limited road networks, and inadequate maintenance impair safety and slow the shipment of goods.
Resolving land disputes
The MJR also recommended resolving land disputes while respecting traditional land allocation practices, putting place measures to secure land titles in an equitable manner in order to promote economic efficiency, and investing in education and health of farmers.
“Together, human capital development and more secure property rights could be the catalysts for investment that helps raise the current low returns to labor and land,” it added.
The MJR added the agriculture research would have more impact if it centers on research addressing gaps in promising value chains, and adaptation to climate change, and not only rice.
Mindanao also needs better planning and more incentives for efficient water and inventory of water resources more than government-initiated expansions of irrigations, according to MJR.
It recommended the continuation of decentralizing the responsibility for operations and maintenance to irrigators associations because “irrigation has not been used much to raise agricultural production” due to low investment and inadequate maintenance and emphasized the need for irrigation service fees to fund both the operation and maintenance of irrigation systems and the organizational development activities of irrigators associations.
Cut trade costs
The MJR added cost of shipping can be reduced by consolidating port operations to increase sale, for instance, by channeling all domestic goods to Mindanao International Container Terminal (MICT) in Misamis Oriental or shipping domestic cargo through MICT and international cargo through Davao region.
The report recommended lifting the requirement to obtain license for domestic vessels to ship goods to foreign ports in order to facilitate partnerships between domestic and foreign companies, and allowing foreign ships to serve domestic ports to stir competition and reduce shipping cost.
It said this will “open up access to technology and a larger market share, strengthen safety standards, and enable operators to choose the mix of domestic and export cargo that maximizes cargo load.”
“Laws and regulations could also be revised to ensure the VAT (value added tax) is not charged on the full value of ships chartered for temporary period, eliminate the percentage of cargo-handling fees,” it added.
The MJR suggested allocation of more resources for testing, increasing laboratory capacity, and technology to improve compliance for major export products as the country’s agricultural exports are rejected in foreign markets due to failure to meet phyto-sanitary standards.
It said the Department of Agriculture’s “oversight, equipment, and training” are substandard while inconsistent policies for accrediting private laboratories. (Antonio L. Colina IV / MindaNews)