BSP official on how to develop agri industry: 'Be less obsessed with rice'

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Metro Manila (CNN Philippines, October 16) — End the land distribution program, be less obsessed with rice, and let farmers shift to higher value crops.

These are the solutions presented by Felipe Medalla, member of Bangko Sentral ng Pilipinas' Monetary Board and Development Budget Coordination Committee, to make the country's agriculture industry more vibrant amid the shortage and rising costs of rice in the market.

"The first thing I would do is end CARP. Having all these very small producers is quite inefficient," he said in a media briefing Tuesday.

Medalla was referring to Republic Act No. 6657 or the Comprehensive Agrarian Reform Program, which directs the redistribution of public and private agricultural lands to farmers regardless of tenurial arrangement.

Instead, Medalla said, rice production should be left to the private sector.

"Effectively we have said corporations should not be in agriculture, one thing you will notice is that corporations are a bigger source of productivity growth because they are able to mobilize more resources and finance than an ordinary household," he said.

Medalla said he will also advise Filipinos to "be less obsessed with rice" as it is quite impossible for the country to become a huge producer of the grain staple.

Huge demands for rice require portions of the country to be as agricultural as provinces like Nueva Ecija and Pampanga, he explained.

"It's like basketball--we're obsessed with it but maybe we should be doing soccer, football," he added. "I think just like basketball we will do better in the Olympics if we were less obsessed with basketball."

Medalla added that local farmers should also shift to higher value crops.

"Again with rice, remember the welfare of the farmers will be better if they are instead guided to go to higher value [crops]," he said.

"Think of farmers' income rather than [asking if we are] producing enough rice for ourselves. It's not an area where we have a big advantage," he added, noting that the Philippines is the biggest fruit exporter in Southeast Asia.

Finance Secretary Carlos Dominguez, who once served as agriculture chief, echoed Medalla's sentiments.

Citing a map created by the International Research Institute, Dominguez said the Philippines has "relatively small" irrigable lands compared to other countries in the region such as Myanmar, Cambodia, Vietnam, and Thailand.

"We should really be rational about our goals and realistic about our resources," Dominguez said. "If you remove your obsessions maybe you can come [up] with more rational."