History of the Philippine Agriculture

9560 Words Sep 14th, 2012 39 Pages
Philippine Agriculture over the Years: Performance, Policies and Pitfalls 1
Cielito F. Habito and Roehlano M. Briones 2

Introduction Although many still think of the Philippines as an agricultural economy, strictly speaking, it is not. Agriculture, fishery and forestry directly account for just one-fifth (20 percent) of the economy’s aggregate domestic output (GDP). Ever since the 1960s, the direct share of agriculture in the GDP had fallen below one-third, and by 1981, the sector’s share had decreased to only 23 percent. Growth from this level was rather anemic, averaging 1.7 percent per annum during the period 1981-2003, compared to the average overall GDP growth of 2.6% over the same period. While agriculture output was largely
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The last section identifies the pitfalls that have hampered investments in the sector and stifled growth in the agribusiness industry, and ends with a general indication of the needed interventions to overcome the sector’s current hurdles.

Production and Productivity Trends Labor productivity. Up until the 1970s, the Philippines’ agricultural performance, in terms of both agricultural Gross Value Added (GVA) and agricultural exports, compared well with its neighbors and other Asian countries (Figure 3a). But by the 1980s and 1990s, the country had lagged behind most of the countries in the region (Figures 3b and 3c). This came as agricultural output growth had slowed down dramatically through the decades (Figure 4). Moreover, the sector’s growth had been rather erratic in the 1990s, especially with the periodic occurrence of the El Niño phenomenon that had appreciable impact on weather patterns and, consequently, agricultural performance. Table 1 shows the average annual growth in GVA of major agricultural commodities since 1960. What is clear from the table is that growth rates of all commodities, except for livestock and poultry, have been slowing down over time. Furthermore, growth rates have been below the population growth rate, implying that production has not been able to keep up with increasing population. Erratic and decelerating growth over the past two decades is a major concern, as agriculture continues to employ a large

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