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THESIS ABSTRACT
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Year
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: SUGGESTED AGENDA TOWARDS RICE SUFFICIENCY
IN NAGA CITY
: AVENGOZA, ET. AL. , RAMON C.
: MASTER IN BUSINESS ADMINISTRATION
: 1997
: ATENEO DE NAGA UNIVERSITY
A. INTRODUCTION
Rice sufficiency has always been the agenda of Philippine administrators
because of its social, economic and political impact on the population. Unfortunately,
achieving this objective has remained elusive through the years. In spite of this, the
Philippines has been a net rice importer - importing about 5 to 10 percent of its
domestic rice requirement during most part of the 20th century.
During the rice crisis in 1995, Naga City - one of the major rice trading centers in
the Bicol Region - experienced shortage in this most basic commodity for the first time.
This crisis awakened the Naga City government to the fact that the supply of the rice
cannot be controlled to meet the requirement of the residents; and, that its development
plans have placed greater emphasis on manufacturing, trade and service sectors
leaving in the issue of food sufficiency in the hands of private traders.
Realizing the importance of rice, the Naga City government initiated efforts to
pursue an agenda that will ensure rice sufficiency for the residents of Naga City.
The overall objective of this study is to develop an agenda for a training rice
sufficiency in Naga.
This study draws heavily from available secondary data on the various sectors
of the rice industry. The primarily data were generated to validate the analysis from
secondary sources and were limited to the responses of sample farmers from the
Barangays of Balatas and San Felipe. Key informants from the major sectors of the
industry - within and outside Naga - were also interviewed to gain a deeper
understanding of the forces affecting these sectors.
The agenda towards rice sufficiency in Naga was formulated based on the
results of the analysis of the internal and external environment of the City government.
The analysis of the internal environment identifies the strengths and weaknesses of the
Naga government to carry out agricultural development strategies. An examination of
its external environment identifies the threats and opportunities confronting the major
sectors of the industry in its effort towards sufficiency.
Naga is the established center of commerce and trade not only in the province
of Camarines Sur but also in the Bicol region. It brings business and employment
opportunities to people within and outside Naga. Large businesses- like retailing,
wholesaling, manufacturing, services and financial institution-are located in Naga.
With this booming commercial environment, the agriculture sector of Naga Citybeing secondary economic activity in the area- may receive less attention. However,
the nearness of most farms to the commercial center may prove to be more
advantageous because of the presence of a ready source of material inputs- the
dealers operating in the central commercial districts.
Marketing of farm produce will also be easier as well as the availability of market
information. The availability of passable farm-to-market roads will make farmers more
mobile and easily linked with the market for their produce.
The strategic location of Naga and the very favorable or balanced programs of
the government will continue to attract investors toward services and commercial
endeavors. Such situation may affect the demand for the use of land for agriculture,
residential and industrial uses. The evident conversion of land in the City into residential
and commercial areas, indeed, is a threat to the agriculture sector and could likely
result in the inability of the City government to increase rice production. Procurement
from other areas will always be an option for the government, hence, the need to
provide the necessary budget to ensure that rice will not the consumers' plate.
B. FACTORS AFFECTING RICE SUFFICIENCY AGENDA IN NAGA CITY
One of the major strengths of Naga is its strategic location in Camarines Sur
and mainland Bicol. Thus, it is accessible to the major types of transportation facilities
and ideal to various economic activities
Naga's rural road network is underdeveloped and access to upper rural
barangays is limited. The public sector, both national and local, made minimal
investments in farm-to-market roads and other agricultural support infrastructures. This
is worsened by the deteriorating condition of roads outside Naga resulting in the limited
inflow of agriculture produce. Naga has a vast agricultural land and its soil is generally
suitable for cultivation of a variety of agricultural crops. Despite all of these, productivity
of its agricultural sector is very low.
In 1994, actual rice production of this sector was only 9,235.10 metric tons,
while Naga needs 23,343.15 metric tons of rice for its population. This created a
production shortfall of 14,111.05 metric tons or 60.44 percent of its rice requirement
was from its neighboring towns.
Majority of agro-industrial establishments are found in Naga's central business
district, thus Naga farmers can easily purchase needs farm implements and inputs.
However, high prices deter these farmers in buying much needed farm implements and
inputs because of their limited capital for farm operations- the result of their low income
from rice production activity. Also, these farmers cannot access formal sources of
credits due to complex requirements by both government and private financial
institutions.
Furthermore, existing irrigation facilities in Naga are dilapidated and/ or
destroyed by past typhoons resulting in inadequate water supply for rice farms. These
factors contributed in their low yield every cropping season and therefore low income
generated from rice production.
The Robredo administration is a strong and decisive local government unit. The
executive and legislative branches of government have a good rapport that resulted in a
limited observance of the principle of check and balance. It also enjoys the full trust and
confidence of the national leadership and its constituents because of its transparency
policy.
The administration has a competent technical staff manages the resources of
Naga City. The executive in finding sources of funds for its development programs and
projects.
Development plans of the Naga government focus on urbanization resulting in
the minimal public sector investment in agricultural support facilities. In Fact, there is no
coherent agricultural development plan, which also contributed to the institutional
neglect of local agricultural sector. The 1997 approved budget shows a very minimal
budget allocation for agricultural development programs.
C. RECOMMENDED STRATEGIES TOWARDS RICE SUFFICIENCY IN NAGA CITY.
a. Establish adequate farm to market roads not only within Naga, but also in other rice
producing neighboring towns.
The establishment of more passable farm to market roads will create a
double-edged impact on farm production because it will cut the marketing cost of both
palay and inputs of production.
Farmers may not be able to produce the rice requirement of Naga because of
the limited agricultural land devoted to rice production, and growth in population. Thus,
it is important that Naga is linked to its rice producing neighboring
municipalities-specifically the municipalities that are members of the Metro Naga
Development Council.
b. Construction of irrigation facilities in irritable lands repair and rehabilitation of existing
facilities in Naga.
Given the growing scarcity of the land being devoted to rice production in Naga,
investments in productivity-enhancing infrastructure such as irrigation facilities is the
most rational approach to maximize production. New technologies on rice variety and
fertilizers will not enable farmers to maximize their productions if their rice lands are not
properly irrigated and/or without adequate water supply.
c. Strengthen farmers' organizations and cooperatives to enable them to become
competitive in the marketing and distribution of the produce of their members.
The Naga government, in cooperation with national agencies such as DA, NFA,
Cooperative Development Authority (CDA) and other non-government organizations in
Naga should provide farmers' organizations and cooperatives not only technical but
support services - like credit, management and value formation training, and institution
building - among others.
Furthermore, CDA through its office in Naga should register and monitor the
management of the resources of farmers' organizations and cooperatives in the area. It
should conduct periodic monitoring and evaluating of the activities and operations of
farmers organizations and cooperatives.
d. Facilitate access of farmers and farmers' organizations and cooperatives to post
harvest facilities.
The Naga government should, prioritize and provide strategic rice producing
areas with post harvest facilities. It should assist in the acquisition of post harvest
facilities by farmers, and/or farmers organization and cooperatives. It should also
provide farmers organizations and cooperatives with research and extension services
as well as linkages to national agencies, non-government organizations and
educational communities for the improvement of existing post harvest facilities and
technologies.
e. The Naga City government should facilitate the access to credit to local formal
financial institutions of farmers, and farmers' organizations and cooperatives.
The provision of credit to farmers, and farmers' organizations and cooperatives
should be given to formal financial institutions since formal credit is advantageous to
farmers than informal credit. The Naga government should only strengthen and
facilitate that these sources of credit and ensure that they are made available to small
farmers.
Through proper management of farmers' organizations and/or cooperatives,
access to credit of small farmers would be greatly enhanced and will ensure the return
of government' investments.
f. The Naga government through the National Food administration (NFA) should
implement a palay procurement program to influence the farm gate prices of palay and
provide incentive to small farmers in Naga.
It is imperative for the Naga government to provide marketing interventions to
compensate for the apparent failure of the national government and/or NFA.
Also, the Naga government should institute a palay procurement and distribution
program that will enable it to buy palay from Naga farmers at least the support price
level, perform buffer stock holding operations, and import rice during production
shortfalls.
The national and local government has historically intervened in the rice pricing
mechanism both at the retail and farm levels. Therefore, the Naga government - in
coordination with Department of Trade and Industry and NFA - can enact price policies
that will stabilize the farm-gate price of palay, and market price rice.