IN FOCUS: Agricultural policy research for inclusive growth

With tepid output growth over the years, the agricultural sector now accounts for just above a tenth of gross domestic product. About 32 percent of the ranks of the employed work in agriculture, forestry and hunting, and fishing. The poor can mostly be found in the rural areas working in these low-skilled, low-productivity, and low-income jobs, as PIDS research has shown. Evidence-based policies are needed to boost agricultural productivity and help reduce the ranks of the poor.

PIDS has done extensive work in agricultural policy research, in support of the government’s goal of making growth more inclusive. A recent paper by PIDS Senior Research Fellow Roehlano Briones argues that the agricultural and rural economy should be at the “forefront, rather than periphery, of the country's strategy for quality employment generation.” This can be achieved, he said, by enabling a structural transformation in agriculture, by shifting to high-value crops, which are more profitable than traditional crops such as rice and corn.

Agricultural diversification can increase agricultural productivity and raise farm incomes, enabling farm households to invest in health and education. However, this transformation requires rapid technological change and improved rural infrastructure, which clearly call for increased investments in infrastructure as well as in agricultural research and development (R&D), an area where the Philippines lags behind its neighbors. But it is not enough to just hike state expenditures in agriculture, which have in fact grown in recent years. Faulty design and execution of programs are partly to blame for the disappointing performance of the agricultural sector,  PIDS has found. The recommendation is to veer away from input subsidies and similar production support (audit reports of which have shown leakages and other anomalies) and focus on public goods with evidence of impact, such as roads, airports, electrification, regulatory services, and R&D for technological change and agricultural modernization.

Check out PIDS research on agricultural policy, including impact assessments and case studies. You may access these studies via the SocioEconomic Research Portal for the Philippines by simply typing ‘agriculture’ in the Search box.

• Urgent: A road map for agro-industrial development in the Philippines
• Agriculture, Rural Employment, and Inclusive Growth
• Impact Assessment of the Agricultural Production Support Services of the DA on the Income of Poor Farmers/Fisherfolk: Review of the Evidence
• Assessment of Prospective Impact of Fruits and Vegetables Research at the Industry Level in the Philippines: the Case of the ACIAR-PCAARRD Horticulture Project
• The Structure of Agricultural Trade Industry in Developing Countries
• Market Structure and Distribution of Benefits from Agricultural Exports: The Case of the Philippine Mango Industry
• Addressing Land Degradation: Benefits, Costs, and Policy Directions
• What’s in store for AFNR graduates in the Philippines?
• Poverty and Agriculture in the Philippines: Trends in Income Poverty and Distribution
  

NEW PUBLICATIONS

PIDS Book 2013-03: PJEPA: Strengthening the Foundation for Regional Cooperation and Economic Integration, Vol. I
edited by Erlinda M. Medalla

This two-volume publication of the Philippine Institute for Development Studies (PIDS) and the Philippine APEC Study Center Network (PASCN) is composed of 17 studies that assess the potential impact of the Philippines-Japan Economic Partnership Agreement (PJEPA) on the Philippine macroeconomy and key sectors, which include agriculture, manufacturing and trade, small and medium enterprises, and tourism. Jointly conducted in 2003 by the PIDS, PASCN, and the Department of Trade and Industry, these studies aided Philippine representatives during the negotiations for the agreement with Japan from 2004 to 2006.

Volume I contains papers that present an impact analysis on the macroeconomy and how the agreement works within the framework of regional economic integration. It also contains special papers tackling different political concerns surrounding the PJEPA, such as issues on human resource development and movement of persons. Click here for the full article.

PN No. 2013-10: Philippine Fisheries Trade with ASEAN: Chokepoints to AEC 2015
by Danilo C. Israel

The planned establishment of an ASEAN Economic Community (AEC) in 2015 has induced member-countries to implement concrete measures to improve their readiness for it. The Philippine fisheries sector has undertaken some steps to enhance its competitiveness leading to the new ASEAN arrangement. Nevertheless, critical chokepoints in its supply chain remain, raising questions on its ability to adequately meet the AEC challenges.

This Policy Note provides a brief background of the sector, reviews Philippine fisheries trade with the ASEAN, summarizes the critical chokepoints in the fisheries supply chain, and recommends measures for improvement. While fish trade between the Philippines and other ASEAN countries is low at present, there is hope that if and when the AEC materializes, the situation would significantly improve. Effectively addressing the different chokepoints will help promote the chance of success. Click here for the full article.

RPS 2013-01: An Assessment of TESDA Scholarship Programs
by Aniceto C. Orbeta, Jr. and Michael Ralph M. Abrigo

This paper reports on the results of the review of the two major scholarship programs of the Technical Education and Skills Development Authority (TESDA), namely: (a) the Training for Work Scholarship Program (TWSP); and (b) the Private Education Student Financial Assistance (PESFA). The two scholarship programs accounted for 73 percent of scholars among the technical vocational education and training (TVET) graduates in 2007 (TESDA 2010a). The paper was commissioned by the Department of Budget and Management to be an input to the effort of the Philippine government to improve the policy basis and result orientation of the budgeting process. Click here for the full article.

DP 2013-45: Medical Tourism in the Philippines: Market Profile, Benchmarking Exercise, and S.W.O.T. Analysis
by Oscar F. Picazo

This report reviews the medical tourism industry in the Philippines. It discusses the global market for medical tourism, analyzes the demand and supply aspects of the local industry, and identifies its drivers of growth. It performs an industry benchmarking exercise by looking at benchmarks associated with strategy setting, organization and management, service quality, care, travel and accommodation, and financing. It also conducts an analysis of the strengths, weaknesses, opportunities, and threats of the industry. Click here for the full article

DP No. 2013-44: Relative Price Effects on Decompositions of Change in Aggregate Labor Productivity
by Jesus C. Dumagan

This paper shows that the decomposition of log-change in aggregate labor productivity (ALP) devised by Balk (2013) based on Sato-Vartia indexes is inexact when applied to gross domestic product (GDP) in chained or in constant prices so that sectoral contributions do not necessarily add up to "actual" log-change in ALP. However, this paper adjusts Balk`s decomposition by incorporating "relative prices"--from the "generalized exactly additive" (GEAD) decomposition of "arithmetic change" in ALP (Dumagan 2013)--and shows that the adjusted Balk decomposition is exact for GDP in chained or in constant prices like GEAD. An important finding is that relative prices could reverse the signs of sectoral contributions from Balk`s inexact decomposition. Hence, results from related decompositions of log-change in ALP, e.g., those based on the Tornqvist framework, that do not explicitly recognize relative prices could be misleading and, therefore, may need reconsideration. Click here for the full article.

SPECIAL FEATURE: 11th Development Policy Research Month
(Good Morning Boss-PTV 4, September 12, 2013)

WATCH THIS VIDEO ON YOUTUBE

Broad Coalition needed to deal with enormous jobs challenge

THE PHILIPPINES needs to create 14.6 million jobs in the next four years, and the way to do this is by keeping the country on a sustained path of economic growth. This will be possible through a broad reform coalition that will work to make growth inclusive and support policies that will generate more and better jobs.

This was stressed by experts from the World Bank and the Philippine Institute for Development Studies (PIDS) as they dialogued with stakeholders in the labor and business sectors as well as the academe last Sept. 13. Read more

Experts call attention to inequalities in health care

IN THE PHILIPPINES, maternal and child health services remain inequitable. This was the gist of the seminar on Health Care for All last Sept. 24 at the Romulo Hall of NEDA sa Makati Building, in celebration of the 11th Development Policy Research Month.

“Trends with very high level of inequity are seen in access to skilled birth attendants and facility-based delivery, said Valerie Gilbert Ulep, research associate at the Philippine Institute for Development Studies (PIDS) in his presentation “Are there improvements in the Delivery of Maternal and Child Health Programs for the Poorest in the Philippines? Read more

Gov’t urged to focus on investment partnerships in health

THE GOVERNMENT should deepen Public-Private Partnership (PPP) arrangements in the health sector if it wants to achieve universal health coverage.

Dr. Josephine Anne Lucero, research consultant at the Philippine Institute for Development Studies (PIDS), drew a distinction between the relatively short-term “Public-Private Interaction” (PPI) and a “Public-Private Investment Partnership” (PPIP) that lasts at least 10 years and yields system-wide efficiency gains. Read more

Gaps in PhilHealth coverage cited

THE GOVERNMENT has achieved universal coverage of the poor through the Philippine Health Insurance Corp. (PhilHealth), but this may be uneven and there are wide disparities at the regional and provincial levels. The same is true for PhilHealth’s “mandatory” program.

These were the findings of separate studies conducted by the mother-and-daughter tandem of Raymunda and Denise Valerie Silfverberg, research consultants of the Philippine Institute for Development Studies (PIDS), which were presented in a forum last Sept. 24 as part of activities for the 11th Development Policy Research Month (DPRM). Read more

SEMINAR UPDATES

• ADB - PIDS Joint Economic Forum on Growth in Developing Asia and the Philippine Economic Outlook
  Date: October 10 2013
  Time: 2:00-5:00 p.m.
  Venue: Carlos P. Romulo Hall, NEDA sa Makati Bldg., Legaspi Village, Makati City
  
  
• PIDS-CPBRD Knowledge Sharing Forum on "Industry Roadmaps and National Industrial Development"
  Sponsors: Congressional Planning and Budget Research Department, House of Representatives
  Date: October 16, 2013
  Time: 1:00 p.m. - 3:40 p.m.
  Venue: Speaker Fuentebella Hall, Ground Floor, South Wing Annex, House of Representatives
  
  
• Pulong Saliksikan on "Financing Infrastructure in the Philippines"
  Date: October 24, 2013
  Time: 1:00 p.m. - 4:0 p.m.
  Venue: Carlos P. Romulo Hall, NEDA sa Makati Bldg., Legaspi Village, Makati City
  

DATABASE UPDATES

Exchange Rate

The monthly average peso-dollar exchange rate slightly went down to PHP43.8318:USD1.00 in September, from PHP43.8639:USD1.00   in August.

Year-on-Year Inflation Rate

The year-on-year headline inflation rate went up to 2.7 percent in September from 2.1 percent in August. According to the National Statistic Office (NSO), the uptrend was brought about primarily by the higher annual increment in the heavily weighted food and non-alcoholic beverages index. Faster annual increases in the indices of alcoholic beverages and tobacco; housing, water, electricity, gas and other fuels; and health were also noticed during the month. Likewise, core annual inflation rate rose to 2.3 percent in September from 1.9 percent in August.

Source: National Statistics Office (NSO)

Need Help? Have Feedback? Feel free to Contact Us.
If you do not want to receive PIDS Updates, click here.

© 2013 Philippine Institute for Development Studies.