Showing posts with label Philippines. Show all posts
Showing posts with label Philippines. Show all posts

Wednesday, October 22, 2008

Dealing with the budget process problems: Leak-plugging or Re-piping?

The September 27, 2008 editorial of the Philippine Daily Inquirer entitled “Plugging the Leak” gave us an insight on some of the realities surrounding the budget process of the country. It implied that while the “power of the purse” remains with the Congress, the “power over the contents of the purse”, the way and how much should be spent where, still remains with the President.

As the editorial notes: There is no disputing the President’s complete control of the current budget process. It is one main source of her continuing hold on MalacaƱang; it explains in large measure her continuing political relevance despite a three-year-long crisis of legitimacy. She has learned to keep most of her political allies happy, through a judicious mix of open budgets (open to congressional insertions, that is) and tight control of fund releases.

The editorial also surmises that “[i]f the proposed 2009 budget is any indication, she has even learned to provide for her political future by padding the proposal with billions of pesos in potential election-spending funds.” This is because “the political class (not just President [Gloria] Arroyo alone) found loopholes in the law, and widened them.” An example is the provision on savings found in Article VI, Section 25 (5) of the Constitution which is being used by the President thus “[leading] us down the road, ultimately, to the wonderland of rolled-over budgets”.

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Thursday, April 17, 2008

The Price of Rice Protectionism

The global price of rice is soaring, and for the Philippines – the world's largest importer of rice annually – that's bad news. Food queues and fears of riots are real fears. But this is a problem of Manila's own making.

Alone among World Trade Organization member nations, the Philippines imposes quantitative restrictions on rice imports, implemented by a government monopoly. Since the 1970s, the state-owned and controlled National Food Authority (NFA) has maintained tight controls on rice imports. This policy has stood in sharp contrast to other countries such as Vietnam, Indonesia and Bangladesh, which have abolished, privatized or sharply reduced the authority and scale of their food monopolies – and enjoyed more efficient production and cheaper consumer prices.

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Wednesday, April 9, 2008

Philippines: Addressing the Food Security Issue

When Filipino-born Eduardo San Juan developed the design for the lunar rover of Apollo 15, he was the one who got paid. But when the Philippines helped design the technology for producing rice, the Filipinos are the ones who have to pay a larger price. No, the problem is not with the International Rice Research Institute (IRRI) for the organization had been very supportive in helping develop and further improve the varieties of the country's staple food. The problem lies with the Philippine government for it wasted all the opportunities that could have made the lives of millions of Filipinos a lot easier.

Once again, the Philippines is on the brink of a looming crisis: Hunger. Sitting president Gloria Arroyo, however, denies this but food rationing – to the point of using indelible inks just to ensure that rice is distributed or sold fairly – cannot tell a palatable lie. Even one of her agriculture spokesmen admits the reality of the impending food shortage and adds that rice sufficiency will only be at 92% this year.

Or maybe, Mrs. Arroyo would just like to be consistent with her Orwellian talks. While she assures the public that there is no shortage, she exhorts of conserving rice. While she talks of a rice supply that is enough, she discusses with foreign countries the possibility of exporting the staple food to the Philippines. And while she prides with rice stocks, she unveils her plans of lifting the rice import quota as well as opening up of the ports for more and more rice importation. And these she does at the time when the people are already feeling the burden of increased prices of rice due to limited supply.

But worse than the Orwellian talks is Mrs. Arroyo's announcement of a multi-billion-peso plan to improve the agriculture sector to solve the impending food security issue – a plan which raises brows and draws wrinkles in the foreheads as it involves a large amount of money amounting from P36 billion to P49 billion. In the first place, what had happened to the Jocjoc Bolante “liquified” fertilizer scandal? The NBN-ZTE multi-million dollar scandal? And, lately, the Quedancor grand swine scandal? To add the list, rumors are also circulating lately that the Philippine Coconut Authority has misappropriated the salt fertilizer fund supposedly to be distributed to the coconuts farmers. Another billion-peso scandal?

More than the fiscal transparency issues, however, is the issue on the soundness of the multi-billion-peso agriculture plan. Based on the announcements of Mrs. Arroyo, the budget for the agricultural sector development will be mostly spent for fertilizer, irrigation and infrastructure, education and research, credits for farmers, and distribution of higher-yielding seeds. While these items may directly increase agricultural yield, the real problem confronting the agriculture sector, however, will remain un-addressed. And this problem is the lack of clear and concrete government policies protecting the farmlands, uplifting the farmers and improving their welfare. For example, until now there is no law that regulates as well as penalizes excessive conversion of agricultural lots to residential or commercial areas. The once famous Banaue Rice Terraces, for instance, is now rapidly becoming a housing terraces and nobody is doing anything to abate this. The lands along the Maharlika Highway from Daraga, Albay to Naga City, Camarines Sur are now rapidly turning from productive rice fields to commercial and residential areas. Similarly, the agricultural lands in Rizal, Bulacan, Cavite and Laguna are also being developed to accommodate more and more housing projects. These, in addition to a number of others, therefore leads to the questions: Where is the Comprehensive National Land Use Plan? And where are the provisions that will punish the perpetrators of illegal or irregular land conversions?

Second, the Philippines also lacks a law that uplifts the lives and reputation of the farmers. For this reason they seem to remain as lower class citizens – a treatment which is exactly the opposite of the treatment being given to the farmers in the United States and in most parts of Europe. Compared to the farmers, Filipino overseas contract workers or popularly known as OFWs are a little luckier. At least there are a number of agencies that help them: the Philippine Overseas Employment Administration, the Overseas Workers Welfare Administration, the Department of Foreign Affairs, and the Philippine embassies around the world. In addition, whenever OFWs are on the point of death, they have Mrs. Arroyo or Vice President Noli De Castro begging for mercy. In fact, they are even considered as heroes inspite of the fact that they are plain and simple slaves in foreign lands. Is it because OFWs earn dollars while local farmers do not?

Third, there is also lesser attention given to rice smugglers which is one of the biggest dis-incentive for the farmers. The Presidential Anti-Smuggling Group (PASG), for instance, have even concentrated on running after smuggled cars rather than after rice smugglers. Imported rice, especially if smuggled, is far cheaper than what is locally produced. Hence, when the smuggled rice and that which is locally grown are sold in the market side by side, the buyers would logically prefer the smuggled one being cheaper. If the locally grown is left unsold, the farmers would therefore reconsider planting more in the succeeding planting seasons.

Of course, there is also minimal or no attention given to rice cartels and rice hoarders. Worse, Agriculture Secretary Arthur Yap and the Arroyo Government as a whole, are in complete denial as to the existence of these scrupulous groups and individuals. Hence, the impossibility of addressing the problem. As a principle in the field of medicine goes, a sickness cannot be cured if the physicians do not believe that it really exists.

Addressing the food security should not be a short but a long term concern. Realistically speaking, it cannot even be considered a sole concern of the government as it also involves the people and the whole State as a whole. But since the government is the one in-charged to do the steering, it should open its eyes and accept the realities of the situation. For instance, the problem is not all about money. It also involves transparency in managing the resources; proper discretion and knowledge in the passage and enaction of policies that eliminate, or at least minimize, the roots of the problem; and fair and dedicated implementation of the same. Otherwise, the problem will just be recursive, cyclical and never-ending. If this happens, the efforts undertaken and the resources utilized will again remain nothing but wasted opportunities.

(A version of this article also came out in the April 7, 2008 issue of the Albay Journal.

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