[OPINION] The war on poverty

DURING the Arangkada Forum on September 14, there was much focus on sectors with substantial growth potential—including agriculture, creative industries, ICT, manufacturing, mining, logistics and tourism. In my panel, we discussed agriculture, creative industries and tourism. Inclusive growth and raising the poor out of poverty through employment generation were issues raised by all panelists, given the fact that the high rate of poverty and the high number of poor citizens has been a persistent development challenge in the Philippines.

Within the Asean region, Malaysia and Thailand have nearly eliminated poverty below $1.25 a day in their countries, while Indonesia and Vietnam have made better progress in this indicator of development than the Philippines. These countries in past decades (to varying degrees) have had more economic growth, more investment and quality job creation, fewer national disasters and better political and policy stability than the Philippines.

In recent years, however, the Philippines is doing better. With consistent stronger economic growth, higher domestic and foreign investment, better governance and a declining population growth rate, the poverty rate is declining. The targeted rate of reduction of the Duterte administration is 1.5 percent per year so that the percentage of Filipinos in poverty in 2022 will decline to 17 percent.

According to the Philippine Statistics Authority, farmers and fishermen are among the poorest in the country: “Among the nine basic sectors, farmers, fishermen and children belonging to families with income below the official poverty threshold or poor families posted the highest poverty incidences in 2015 at 34.3 percent, 34 percent and 31.4 percent, respectively. These sectors consistently registered as the three sectors with the highest poverty incidence in 2006, 2009 and 2012. Also, 5 of the 9 basic sectors consisting of farmers, fishermen, children, self-employed, unpaid family workers and women, belonging to poor families  had higher poverty incidence than the general population estimated at 21.6 percent in 2015.”

The poor are often hungry. Their diet is inadequate. Their children are frequently malnourished and stunted. In Metro Manila there are more than 300,000 families living without shelter and under bridges. These families need a massive improvement in nutrition. Urban farming is one of the options to address this and improve the learning capacity of poor children in school. Better nutrition needs to go hand-in-hand with the Conditional Cash Transfer (CCT) program, or the Pantawid Pamilyang Pilipino Program, implemented by the Department of Social Welfare and Development. CCT now assists 4.4 million households totaling 20 million Filipinos. The transfers are provided directly to recipients on the condition that their children are inoculated and participate in school feeding programs to combat childhood diseases and malnutrition. Total funding increased from  P10 billion in 2010 to P79 billion in the 2017 budget.

Quite a number of recommendations were made at the Arangkada Forum to improve social-protection programs, including the government’s CCT program, to protect the poor (I selected a few).

Recommendations:

  • Continue to reduce number of poor in absolute terms and as percentage of population.
  • Continue to reduce the incidence of hunger.
  • Expand insurance coverage to include more poor.
  • Successfully implement expanded CCT program to include all 6.9 million poor
    families.
  • Implement unemployment insurance as a social safety net.
  • Enhance CCT program to ensure that the rights of poor children are upheld and to help child beneficiaries and their families to become more self-sufficient and self-reliant. (Urban farming is the way to go; the city of Quezon City is doing well along this line).
  • Create jobs and economic opportunities. Job creation in the industrial, agricultural and service sectors will be facilitated by the government, in collaboration with the private sector.
  • Implementation of national identifaiction card (ID) system for improved targeting of social services. Participants identified the pressing need to institute a national ID system that will allow government agencies to provide more targeted social services, and prevent double counting or leakage.

As the focus of my column is agribusiness, we need to deliver support services to farmers and fishermen, such as financing, incentives, technology, irrigation, post-harvest facilities, farm-to-market roads, improved logistics and integration in the supply chain to fully develop the potential of the agricultural industry to develop rural areas and the countryside.

As a consequence, some 20 million rural Filipinos can be lifted out of poverty. And the children of farmer will stop moving from rural areas to urban centers or become  overseas Filipino workers. Isn’t this what the 10-point socioeconomic agenda of the Duterte administration has in mind? Fighting poverty in agriculture?      

Source: https://businessmirror.com.ph/the-war-on-poverty/         

Arangkada forum to explore PHL industrialization

Foreign businesses are looking forward to helping the Philippines reach the next level of development by helping it diversify away from economic pillars like business process outsourcing (BPO) by boosting agriculture, among other sectors.

The Joint Foreign Chambers of Commerce of the Philippines (JFC) said the sixth year of its Arangkada Philippines Forum will focus on “Implementing the 10-Point Agenda.” The forum is set for Sept. 14, where foreign businesses are expected to come up with policy recommendations for the government.

In a news conference yesterday, the JFC said that it will take on issues like opening up foreign investment, boosting value-added merchandise exports, incentivizing agriculture growth, tourism, infrastructure, mining, as well as the expansion of the BPO industry.

The basis for economic growth is currently narrow, according to Julian H. Payne, president of the Canadian Chamber of Commerce of the Philippines, as its drivers remain to be the BPO industry and overseas remittances.

“To join the ranks of all the industrialized countries, you’re going to have to diversify the economy considerably. That means really picking up agriculture, really picking up manufacturing, and diversifying it geographically,” he said.

“The BPO industry has enabled the middle class to rise. Why would you not support that? I think what the country needs is more BPOs. It has the potential to grow. If we don’t address these issues, we give those points away to China and India,” said European Chamber of Commerce of the Philippines (ECCP) President Guenter Taus, speaking in the context of President Rodrigo R. Duterte’s anti-Western statements, threatening Western investments here.

Benjie Garcia, executive director of the Australia-New Zealand Chamber of Commerce Philippines, Inc. (ANZCHAM) for his part, said that the Philippine BPO sector has reached maturity, raising the need to attract new investors and retain those currently here.

“BPO and shared services should be willing to focus on these two current developments, or be less competitive compared to India and China. We need to strengthen some incentives for this industry.”

They added that BPO firms should also look into developing capacity in the non-voice and knowledge sector, noting increasing competition within the region.

Mr. Taus raised concerns over the aging population in the agriculture sector noting the median age of farmers in the country is around 57.

“If we continue this way in 10 years, we will not have any farmers. So there needs to be some programs also to entice people to get back into farming again,” he said.

Mr. Payne for his part called for increased infrastructure and technology to accommodate small-scale family farms and help them evolve to more efficient commercial operations.

“I don’t think we’re going to be able to make huge progress in agriculture without addressing the need for larger, more efficient farming operations with appropriate infrastructure,” Mr. Payne said.

The business groups also said that backward and forward integration is the “key to success” in the mining industry, and urged the government to open refineries that will process extracted minerals, enabling the industry to capture more value added.

“If you want to develop mining, you have to develop in parallel an open environment to foreign investments to manufacturing, and encourage manufacturing,” Mr. Payne said.

ANZCHAM meanwhile said that it will be sharing best practices and experiences with the Philippines, given its technologically advanced mining companies that comply with international standards.

Moreover, foreign businesses also view tourism as a priority sector, but the infrastructure gap will remain as a longstanding challenge in attracting more foreigners to come.

However, the effect of the infrastructure shortfall is not exclusive to tourists.

Ho Ik Lee, president of the Korean Chamber of Commerce of the Philippines, said that South Korean firms have been planning to leave the Philippines, due to high logistics costs, which is about three times that of Vietnam.

Most South Korean companies located in economic zones are leaving the Philippines, and moving to Vietnam. “The costs are killing the manufacturing [industry],” he said.

The forum in September will have panel discussions on the infrastructure gap; industrialization; agribusiness, the creative industries, and tourism; disruptive technologies; and the future of the work force.

“We mustn’t look at each one just alone. We have to look at the combined impact, in what it means in terms of the long-term industrialization of this country, so it becomes one of the industrialized countries, which is what we are all looking for in the end.” said Mr. Payne. — Elijah Joseph C. Tubayan

Source: http://bworldonline.com/arangkada-forum-explore-phl-industrialization/

Next Arangkada Forum tackles President Duterte’s 10-Point Agenda

The Joint Foreign Chambers of Commerce of the Philippines (JFC) will be having their Sixth Anniversary Arangkada Philippines Forum this year with the theme “Implementing the 10-Point Agenda.”

The 2017 forum will emphasize the 10-point Socioeconomic Agenda of the Duterte Administration. With a combination of public and private sector speeches and panelists, the forum will discuss key programs and policies that support achievement of the ten points in the years ahead. Such reforms will be discussed within the framework of Arangkada’s Seven Big Winner Sectors (Agribusiness, BPM, Creative Industries, Infrastructure, Manufacturing and Logistics, Mining, and Tourism).

The Arangkada Philippines Project is the major advocacy—launched in 2010—of the JFC to increase investment and employment in the Philippines. In 2010, the JFC published the Arangkada Philippines 2010: A Business Perspective, an advocacy paper reflecting inputs from focus group discussions of top business leaders on seven sectors with high growth potential: agribusiness, BPM, creative industries, infrastructure, manufacturing and logistics, mining, and tourism, with 471 recommendations to build a more competitive Philippine economy, leading to high growth and new jobs.

The JFC has published five annual assessments of these recommendations, six policy briefs, and seven policy notes, all intended to improve the investment climate. Their advocacy efforts have contributed significantly to recent strong economic growth and the large increase in foreign direct investment, which reached US$ 7.9 billion in 2017, approaching levels of some competing ASEAN economies. These publications are available at the Arangkada website www.arangkadaphilippines.com.

The Sixth Anniversary Arangkada Philippines Forum 2017 will be held on September 14, 2017 at the Marriot Grand Ballroom, Manila. Registration for the forum is now ongoing.

For more information, visit the official event website www.investphilippines.info/forum2017, send an email to forum@arangkadaphilippines.com or call 751-1495 loc. 222.