Agricultural Policy Monitoring and Evaluation 2024

22. Philippines

Main findings

Support to agriculture

Support to agricultural producers (Producer Support Estimate, PSE) in the Philippines averaged 19% of gross farm receipts in 2021-23, lower than in 2000-02 (22%) and down from a peak of support in 2014 (29%).

Market Price Support (MPS) and payments for inputs accounted for 96% of support to farmers in 2021-23. Although budgetary support gained in prominence, support to farmers continues to be dominated by MPS, primarily for sugar, rice and animal products. As a result, domestic producer prices were 23% higher than world market prices on average in 2021-23. Payments to farmers support variable inputs and investment in agricultural equipment and facilities.

Support for general services in agriculture (General Services Support Estimate, GSSE) amounted to 4% of the sector’s value of production in 2021-23, more than 1.5 times the share observed in 2000-02. This included mainly investments in infrastructure, notably for irrigation systems and farm-to-market roads, and in the agricultural knowledge and innovation system particularly for education and extension programmes.

Total support to the agricultural sector accounted for 2.1% of GDP in 2021-23, lower than the 2.9% in 2000-02 but still the highest among countries reviewed in this report.

Key recent policy changes

In July 2023, the Philippines introduced the New Agrarian Emancipation Act that writes off PHP 57.65 billion (USD 1.04 billion) of credit debt for 610 054 farmers. The act cancels all principal loans, unpaid amortisation and interests incurred by agrarian reform beneficiaries (ARBs) from their allocated land under the existing agrarian laws since 1972 and for farmers who have outstanding loan balances to the Land Bank of the Philippines and to private landowners.

The first food stamp programme Walang Gutom 2027 was launched in 2023. This programme aims to reduce hunger and malnutrition among food-insecure households by providing monetary-based assistance through Electronic Benefit Transfer (EBT) cards that can be used to purchase a range of food commodities from eligible stores. The programme allows identified beneficiaries, who earn less than PHP 8 000 (USD 144) a month, to receive digital food vouchers equivalent to PHP 3 000 per month (USD 54) for a period of 6 months. The vouchers can be spent to buy food items from accredited or registered retailers or supermarkets, including those from the government-run KADIWA centres.

The government, in co-operation with the Green Climate Fund (as a co-funder) and the FAO, launched the programme Adapting Philippine Agriculture to Climate Change (APA). This programme aims to develop climate-resilient agriculture (CRA) services and information through the use of low-emission technologies. Supported activities include institutional capacity building for the development of CRA services, efforts to promote the adoption of CRA by farmers (and the provision of an enabling environment for mainstreaming CRA practices, services and decision support tools into programmes of the Department of Agriculture (DA). APA will be implemented until 2030 and is expected to reduce the equivalent of 4.38 MtCO₂eq over 20 years.

In September 2023, the Philippines-Korea Free Trade Agreement (FTA) was signed. Once in force, it will improve market access for Philippine agricultural products such as bananas, processed pineapples and other tropical fruits, industrial products and selected services sectors. The FTA also includes provisions for capacity building and technical co-operation (including on smart farming) between both countries.

Assessment and recommendations

• The Philippines’ agricultural sector is faced with high nutrient balances and low total factor productivity growth. Fostering agricultural productivity gains has been a key priority in the successive development plans of the agricultural sector during the last 20 years, and remains a key objective in the 2021‑2030 National Agriculture and Fisheries Modernisation and Industrialisation Plan.

• Several initiatives are underway to promote sustainable productivity growth along the value chain. Yet most budgetary support to agriculture still consists of input subsidies, which is likely to deter progress in this area. Furthermore, general services support has been steady. Increasing long-term investments in public goods such as R&D, infrastructure and extension services, complemented by an increased focus on strengthening the agriculture innovation system, would help lift agricultural productivity while improving climate adaptation and resilience in the sector.

• The Philippines’ key priorities for agriculture over the past few decades have been food security and poverty alleviation through guaranteeing a stable supply of rice at affordable prices. The objective of rice self-sufficiency has driven a range of domestic and trade policy measures that effectively support rice producers, but at the same time acts as a tax for rice consumers. Removing commodity-specific support will benefit poor consumers and encourage farmers to diversify production away from rice and maize toward higher value commodities. This will help diversify farm income sources and better manage farmers’ risks.

• The new targeted food stamp programme in the form of Electronic Benefit Transfer (EBT) cards is a key component of policy measures to enhance food security. It lets the government address the impacts of rising prices on poor households without interfering with price incentives for farmers. Moreover, this programme can effectively target households in need, promote more varied diets and generate better nutrition outcomes. Still, consumer support programmes such as the EBT could incorporate more flexibility by allowing transfers to vary according to consumer prices.

• The APA project to reduce GHG emissions, co-funded by the Green Climate Fund and supported by the FAO, is a good first step towards the Philippines’ commitment to reduce GHG emissions by an unconditional 2.7%, and by 75% conditional on international and technical support, relative to projected Business as Usual (BAU) cumulative emissions between 2020 and 2030. Additional measures will be required to support this goal. Among others, the Philippines should accelerate efforts to provide an enabling environment, for example through improved financial services, that will incentivise private investors to channel more financial resources to climate change mitigation solutions.

Development of support to agriculture

Figure 22.1. Philippines: Development of support to agriculture

Table 22.1. Philippines: Estimates of support to agriculture

Million USD

	2000-02	2021-23	2021	2022	2023p
Total value of production (at farm gate)	9 599	35 964	35 707	35 081	37 106
of which: share of MPS commodities (%)	90.37	87.85	85.77	89.44	88.35
Total value of consumption (at farm gate)	9 950	37 549	35 856	37 678	39 113
Producer Support Estimate (PSE)	2 156	7 138	7 164	7 567	6 683
Support based on commodity output	2 083	6 521	6 569	6 932	6 062
Market price support¹	2 083	6 521	6 569	6 932	6 062
Positive market price support	2 122	6 521	6 569	6 932	6 062
Negative market price support	-40	0	0	0	0
Payments based on output	0	0	0	0	0
Payments based on input use	69	599	579	615	602
Based on variable input use	36	328	339	325	319
with input constraints	0	0	0	0	0
Based on fixed capital formation	32	271	240	290	284
with input constraints	0	0	0	0	0
Based on on-farm services	0	0	0	0	0
with input constraints	0	0	0	0	0
Payments based on current A/An/R/I, production required	0	0	0	0	0
Based on Receipts / Income	0	0	0	0	0
Based on Area planted / Animal numbers	0	0	0	0	0
with input constraints	0	0	0	0	0
Payments based on non-current A/An/R/I, production required	0	0	0	0	0
Payments based on non-current A/An/R/I, production not required	0	0	0	0	0
With variable payment rates	0	0	0	0	0
with commodity exceptions	0	0	0	0	0
With fixed payment rates	0	0	0	0	0
with commodity exceptions	0	0	0	0	0
Payments based on non-commodity criteria	0	0	0	0	0
Based on long-term resource retirement	0	0	0	0	0
Based on a specific non-commodity output	0	0	0	0	0
Based on other non-commodity criteria	0	0	0	0	0
Miscellaneous payments	5	18	15	20	19
Percentage PSE (%)	22.20	19.49	19.73	21.19	17.71
Producer NPC (coeff.)	1.31	1.23	1.25	1.26	1.20
Producer NAC (coeff.)	1.29	1.24	1.25	1.27	1.22
General Services Support Estimate (GSSE)	244	1 422	1 595	1 347	1 324
Agricultural knowledge and innovation system	56	329	395	298	294
Inspection and control	14	66	67	66	65
Development and maintenance of infrastructure	155	822	913	784	768
Marketing and promotion	6	50	52	50	49
Cost of public stockholding	12	132	142	128	126
Miscellaneous	1	23	26	21	23
Percentage GSSE (% of TSE)	10.16	16.56	18.21	15.11	16.54
Consumer Support Estimate (CSE)	-2 237	-7 235	-7 442	-7 749	-6 515
Transfers to producers from consumers	-2 274	-6 576	-7 029	-6 898	-5 799
Other transfers from consumers	-151	-988	-976	-1 082	-907
Transfers to consumers from taxpayers	0	0	0	0	0
Excess feed cost	188	329	564	231	191
Percentage CSE (%)	-22.40	-19.20	-20.76	-20.57	-16.66
Consumer NPC (coeff.)	1.32	1.25	1.29	1.27	1.21
Consumer NAC (coeff.)	1.29	1.24	1.26	1.26	1.20
Total Support Estimate (TSE)	2 400	8 560	8 759	8 914	8 007
Transfers from consumers	2 425	7 564	8 006	7 981	6 706
Transfers from taxpayers	126	1 984	1 729	2 015	2 208
Budget revenues	-151	-988	-976	-1 082	-907
Percentage TSE (% of GDP)	2.90	2.07	2.22	2.20	1.83
Total Budgetary Support Estimate (TBSE)	318	2 039	2 190	1 981	1 946
Percentage TBSE (% of GDP)	0.38	0.49	0.56	0.49	0.44
GDP deflator (2000-02 = 100)	100	193	188	198	..
Exchange rate (national currency per USD)	48.96	53.12	49.26	54.48	55.64

.. Not available

Note: p: provisional. NPC: Nominal Protection Coefficient. NAC: Nominal Assistance Coefficient. A/An/R/I: Area planted/Animal numbers/Receipts/Income. 1. Market Price Support (MPS) is net of producer levies and excess feed cost. MPS commodities for Philippines are: maize, rice, sugar, beef and veal, pig meat, poultry, eggs, bananas, coconut, mango and pineapple.

Source: OECD (2024), “Producer and Consumer Support Estimates”, OECD Agricultural policy monitoring (database), https://data-explorer.oecd.org/.

Policy landscape

Main policy instruments

Tariffs, tariff rate quotas (TRQs) and domestic market regulations are the most important agricultural support policies. Tariff protection is the Philippines’ main trade policy tool. The simple average applied Most Favoured Nation (MFN) tariff on agricultural products was 9.9% in 2021 (compared to 5.5% for industrial products). Tariff lines applied for agricultural commodities are ad valorem and range from 0% to 65% (UNCTAD TRAINS, 2024[1]).

Tariff rate quotas are applied to 14 agricultural products, with in-quota tariffs ranging from 30% to 50% and out-of-quota from 35% to 65%. Products covered by the TRQs included live swine, goats and poultry and poultry meat, potatoes, coffee, maize, rice and sugar. In March 2019, quantitative restrictions on rice imports were replaced with an import tariff system, under the Rice Tariffication and Liberalisation Law (RA 1120) implemented to comply with the Philippines’ WTO obligations. Import licensing is required for all regulated products (including those under TRQs). Additionally, grains, grain products and sugar require export permits.

The National Food Authority (NFA) implements rice price support by buying buffer stocks at administered prices from domestic producers and selling these stocks at subsidised prices to consumers. To offset the effects of rice liberalisation and to encourage self-sufficiency, the Philippines Department of Agriculture (DA) has implemented several support programmes for rice producers.

To encourage self-sufficiency in production and boost farmers’ incomes, budgetary support is provided for producers’ use of variable inputs, including seeds and fertilisers. Investments in general services are mainly for infrastructure and agricultural research and development.

To achieve its Nationally Determined Contribution (NDC) objectives, the Philippines focusses mitigation efforts on the major sources of agricultural GHG emissions (paddy rice cultivation, livestock enteric fermentation, soil cultivation, and livestock manure management) by adopting nature-based solutions (e.g. microbial inoculants or diet modification to reduce emissions from livestock), crop management techniques (such as supplements like biochar and organic fertiliser to increase soil friability) or renewable energy for water management. The Philippines committed to reduce GHG emissions by 75% relative to projected Business as Usual cumulative emissions between 2020 and 2030, of which 2.7% is unconditional and 72.3% is conditional (UNFCCC, 2021[2]).1 For 2021-30, the conditional target GHG emission reduction for agriculture is 29.4% below the Business as Usual scenario of 539.09 MtCO₂eq cumulative emissions (Department of Agriculture (DA), 2022[3]).

Innovation for sustainable productivity growth

Agricultural production in the Philippines has grown at an annual rate of 0.5% on average between 2011 and 2020, well below the world average of 1.9%. Poor productivity performance is linked to uncertainties in the implementation of the agrarian reform that has limited investment in the sector, a focus on rice self-sufficiency that discourages diversification towards high value products, and a high vulnerability to natural disasters and extreme weather-related events (OECD, 2017[4]; World Bank, 2018[5]). Total factor productivity (TFP) growth, which shows the importance of innovation, technological improvements and improved efficiency in production, has been low in the Philippines at 0.1%, well behind that of other countries in the Asian region and globally (Figure 22.3).

Strategic planning

Fostering agricultural productivity gains has featured in successive development plans of the agricultural sector over the last 20 years. The 2021-30 National Agriculture and Fisheries Modernisation and Industrialisation Plan (NAFMIP) underlines the importance of agricultural innovation as the main source of improved productivity, competitiveness and growth for Philippine agriculture.

The Philippines Department of Agriculture (DA) systematically incorporates considerations of productivity and sustainability when formulating agricultural programmes. Major acts including such consideration are:

• The Organic Agricultural Act of 2010 (RA 10068) provides for the development and promotion of organic agriculture and reaffirmed the government’s objective to increase farm productivity and income, reduce pollution and prevent the depletion of natural resources.

• The 2019 Philippines Innovation Act (RA 11293) recognises the importance of an “efficient innovation ecosystem that addresses and delivers action in various policy areas” including the agricultural sector.

Programme implementation

The Adaptation and Mitigation Initiative in Agriculture (AMIA) was launched in 2013 to increase uptake of climate-resilient agriculture technology and promote sustainable production and management practices in communities across the countries. In December 2023, as part of the AMIA programme, the Climate Resilient Agriculture Office launched the updated version of the National Color-Coded Agricultural Guide (NCCAG) Map, a database showing the natural suitability of crops (such as water availability and climate data) and eight major hazards based on projected climate scenarios for 2050. Designed as a science-based decision-support tool, the NCCAG helps increase farmers’ productivity and income by advising on crop selection for optimal production and identifying climate risk.

The Masagana Rice Industry Development Plan was launched in September 2023. It aims to enhance farmers’ resilience and productivity through climate change adaptation strategies such as adjusting the planting calendar from the wet to the dry season, promoting crop diversification or using balanced fertilisation and climate smart practices. The programme also helps the technological and digital transformation of the rice industry by providing timely, targeted and location-specific information for decision making using satellite technology (Department of Agriculture, 2023[6]).

The Balanced Fertiliser Strategy (BFS) encourages the use of organic-inorganic fertiliser combinations to increase crop production and maintain soil health for long term productivity. In 2022, the DA-Fertilizer and Pesticide Authority (FPA) and the DA-Bureau of Soils and Water Management (BSWM) organised multiple training sessions and demonstration fields across the country to help farmers complement or alternate inorganic fertiliser with organic materials.

In 2023, the Bureau of Plant Industry (BPI) approved the commercial propagation of Bt cotton, the fourth genetically modified crop for the country after corn (2002), rice (2021), and aubergines (2022). The genetically engineered crop is resistant to bollworm (Heliothis armigera) and other pests. Bt cotton is also expected to reduce the need for chemical insecticides and pesticides (USDA, 2023[7]).

In 2023, the government continued to invest in several digital planning and information systems such as the Agricultural and Biosystems Engineering Management Information System and the Geographic Information System for Agricultural and Fisheries Machinery and Infrastructure (GEOAGRI), two interactive mapping systems that provide information on agricultural machinery and equipment, irrigation, farm to market road and other infrastructures. These digital tools aim at improving logistics for perishable products, establishing sustainable infrastructures and upgrading processing, postharvest, and storage facilities.

The government launched the establishment of Agri-Business Corridors (ABCs) to attract more investment in agriculture and to introduce innovative agricultural technologies to farmers. Several innovation pilot sites were created in different regions including the rehabilitation of post-harvest facilities (such as ice plant or cold storage facilities), the development of high-yielding seed laboratories or the development of technology business incubation hubs.

Research and innovation

Internationally, in October 2023, the Philippines together with other ASEAN members states signed the ASEAN-Japan-MIDORI Cooperation Plan which aims to strengthen co‑operation programmes using new Japanese technologies to enhance resilience and sustainable agriculture for ensuring regional food security. Ongoing co‑operation with the Philippines includes developing GHG mitigation technologies economically beneficial for small-farmers, smart agriculture pilot projects and knowledge transfer. Futures projects, such as soil diagnosis of farmland using satellite data, are expected to contribute to the reduction of fertiliser use.

In 2023, the DA-BAR supported the Research for Development (R4D) programme which uses innovation and research generated technologies to increase and sustain agricultural production in the country. R4D applied research and technology projects include:

• Productivity assessment of white and yellow corn in different agro-ecological conditions (such as elevation, soil or climate conditions).

• Development of alternative and cost-effective methods for controlling pest and diseases in mango and banana crop cultivation. Improvement of post-harvest facilities and cold storage systems using low-cost technologies and renewable energy for vegetables.

• Development and promotion of sustainable organic alternative feeds for poultry, swine and small ruminants.

• Development of rice varieties adapted to various biotic and abiotic constraints that limit plant productivity (in co-ordination with Philrice, a government corporate entity under the DA). In 2022‑23, 13 new inbred varieties adapted to environmental stresses (drought, salinity, and flooding) were distributed to local farmers in Bicol and Eastern Visayas. Philrice also developed technologies for smarter crop management and postharvest operations (Department of Agriculture, 2023[6]; Department of Agriculture, 2022[8]).

Recent policy developments

Domestic policy developments in 2023-24

General strategies and plans

In January 2023, the DA published the 2023-28 Philippines Development Plan, the country’s medium-term programme for socio-economic development. The plan set out strategies to modernise agriculture and to make the sector productive, competitive, resilient, and globally connected. It presents the challenges facing agriculture and the objectives helping address these challenges, namely:

• enhancing the efficiency of the agriculture, forestry, and fisheries sector

• expanding access to global markets for agriculture and fisheries

• improving the resilience of agriculture value chains

• strengthening agricultural institutions (National Economic and Development Authority, 2023[9]).

In August 2023, DA adopted the National Agricultural and Fishery Mechanisation Program (NAFMP) 2023-28 which supports the implementation of the National Agri-Fisheries Modernisation and Industrialisation Plan (NAFMIP) and the Philippine Development Plan 2023-28. The NAFMP also aligns with the mandate of the administration to boost domestic agricultural production through consolidation, modernisation, mechanisation, and improvement of value chains. The NAFMP has five major components:

• local assembly and manufacture

• research, development, and extension

• standards and regulations

• support services and institutional development

• human resources development.

In June 2023, the DA in collaboration with other Departments approved the implementation of the National Farm-to-Market Roads Network Plan (FMRNP) 2023-28. FMRNP aims to link agriculture production sites and post-harvest facilities to markets through construction and rehabilitation of roads and highways. The plan foresees farm-to-market investment plans at national and sub-national levels. A single digital FMRNP portal between government agencies is to support FMRNP’s project operation, maintenance, and monitoring and evaluation (Department of Agriculture, 2023[10]).

Producer policies

In July 2023, the New Agrarian Emancipation Act - Republic Act (RA) 11953 was signed into law, which will write off PHP 57.65 billion (USD 1.04 billion) of credit debt for 610 054 farmers, operating on a total of 1.17 million ha of agricultural land (around 9% of the total agricultural land). The New Agrarian Emancipation Act will write-off loans, including principal, interest, and penalties incurred by agrarian reform beneficiaries (ARBs) from land allocated to them under the existing agrarian laws (Presidential Decree 27 of 1972, RA 6657 of 1988 and RA 9700 of 2009). The write off will concern farmers who have outstanding loan balances to the Land Bank of the Philippines and to private landowners. Under these laws, ARBs were required to pay for land in the form of an annual amortisation for a maximum period of 30 years. In addition, the government approved a compensation to landowners under the Voluntary Land Transfer and the Direct Payment Scheme amounting to PHP 206 million (USD 3.7 million).

The excess rice tariff collection from financial year 2022 (above PHP 10 billion – USD 180 million, mandated under the RCEF), was allocated to the Rice Farmers Financial Assistance programme (RFFA). In 2023, the excess income from tariff revenues amounted to PHP 12.7 billion (USD 228 million), which was distributed to 2.4 million small rice farmer beneficiaries (with 2 ha or less planted of rice) as an unconditional cash transfer of PHP 5 000 (USD 90) per farm. Under the programme of Cash and Food Subsidy for Marginal Farmers and Fishers, small producers of maize, coconut and sugar cane received similar support in the form of cash and food assistance amounting to PHP 3 000 (USD 54) in cash and PHP 2 000 (USD 36) equivalent in food per farm.

In April 2023, the DA implemented a Fertiliser Assistance for rice farmers as part of the National Rice Program in 15 participating regions across the country. This assistance was in the form of fertiliser discount vouchers valued at PHP 4 000 (USD 72) per hectare of land or in fertilisers directly procured by the local DA Regional Field Offices. In October, the government modified the modalities of distribution and made it possible to receive fertiliser assistance through Interventions Monitoring Cards that can be used as electronic wallets by eligible beneficiaries to claim fertiliser from DA-accredited merchants (Department of Agriculture, 2023[10]).

In 2023, the National Food Authority (NFA) increased its buying price of rice from PHP 19 (USD 0.34) to PHP 23 (USD 0.41) per kg for dry palay (rice)and from PHP 16 (USD 0.29) to PHP 19 (USD 0.34) per kg for wet palay respectively. The NFA kept its selling price at the same level as in 2022, between PHP 23 (USD 0.41) and PHP 27 (USD 0.48) per kg according to the variety of rice and the type of buyers (authorised retail outlets, government agencies or private institutions) (National Food Authority, 2023[11]).

To mitigate the impact of the oil price surges on the farming sector, a total of PHP 510 million (USD 9 million) was allocated to the Fuel Assistance to Farmers Project. Implementation of the programme was based on DA guidelines issued in May 2023 and done in co‑ordination with the Department of Budget and Management and the Department of Energy. The programme provided for PHP 3 000 (USD 54) as assistance to farmers owning or renting agricultural machineries for crop production when the average Dubai Crude Oil Price based on Mean of Platts Singapore reaches or exceeds USD 80 per barrel for three consecutive months (Department of Agriculture, 2023[10])

Marketing and promotion of agricultural products

During 2023, as the country continued its recovery from the COVID-19 pandemic, programmes ensuring food accessibility, quality and affordability to Philippine households were extended. The network of government stores programme selling at regulated price KADIWA ni Ani at Kita was renamed KADIWA ng Pangulo (KNP) and expanded by signing Memorandums of Agreement across multiple local government units nationwide. The government implemented the KADIWA Financial Grant Assistance to provide for up to PHP 5 million (USD 89 864) assistance to farmers and fisherfolks to cover post-harvest, processing, packaging, transport, and distribution activities, as well as the establishment of new KADIWA stores.

Consumer and nutrition policies

During 2023, to protect consumers from rising commodity prices, the government imposed suggested retail prices (SRPs) on basic food items including processed milk, coffee, bread, noodles, beef and onions. In August 2023, in order to slow down the increase of rice prices the Executive Order (EO) No. 39 mandated retail price ceilings for two categories of rice accounting for 90% of consumption: a retail price ceiling of PHP 41 (USD 0.74) per kg for regular-milled rice and PHP 45 (USD 0.81) per kg for well-milled rice. The EO was lifted in October 2023.

The Food Stamp Programme Walang Gutom 2027 was launched in July 2023 to reduce hunger and malnutrition among food-insecure households by providing monetary assistance through Electronic Benefit Transfer cards. Objectives of the programme also aim to reduce the high rate of child stunting and micronutrient deficiency. The programme is implemented by the Department of Social Welfare and Development (DSWD). It allows identified beneficiaries earning less than PHP 8 000 (USD 144) a month to buy selected food items from DSWD accredited or registered retailers or supermarkets, including KADIWA centres. Digital food vouchers for PHP 3 000 (USD 54) per month are provided for 6 months. Beneficiaries are required to attend trainings or present certificates showing effort to find employment. The programme has started as a pilot for 6 months with a total of 3 000 targeted families. The longer-run target is to feed 1 million beneficiaries (300 000 beneficiaries in the first year, 300 000 in the second year, and 400 000 in the third year) (Asian Development Bank, 2023[12]).

Biosecurity policies

In the context of the continued spreading of African Swine Fever (ASF), the National Zoning and Movement Plan for the prevention and control of ASF was updated, alongside reinforced surveillance and intensified co-ordination with local government units. Financial assistance to set up bio-secure hog facilities under the Integrated National Swine Production Initiatives for Recovery and Expansion (INSPIRE) was doubled from PHP 5.5 million (USD 98 851) to PHP 10 million (USD 179 728) in 2023. INSPIRE was initially launched to hasten hog repopulation in ASF-affected areas. The INSPIRE programme is complemented by the Bantay ASF sa Barangay programme that institutes biosecurity and disease control measures through co-operation between different actors such as local authorities, specialist biosecurity officers and farmers. Grants have been distributed to farmers co‑operatives and associations (FCA) that would establish new bio-secure or conventional facilities. Funding also covered the purchase of pigs, feed and other products such as disinfectants. The Bureau of Animal Industry – National African Swine Fever Prevention and Control Program of the DA launched a caravan tour to raise awareness in markets across the country about ASF, to dissuade transportation of pig and pig meat products and to remind consumers to buy products certified by the National Meat Inspection Services.

In April 2023, in response to the hog cholera viral diseases affecting pigs in Negro Occidental province, the government implemented an immunisation campaign. More than 65 000 doses of vaccines were distributed to backyard farms by local government units of the province.

Policies to facilitate climate change adaptation in agriculture

In April 2023, the new adaptation programme Adapting Philippine Agriculture to Climate Change (APA) was launched, co-funded by the Green Climate Fund (USD 26.3 million) and the government of the Philippines (USD 12.98 million). The Green Climate Fund was established by the United Nations Framework Convention on Climate Change (UNFCCC) in 2010 and is the largest dedicated fund helping countries respond to climate change. The project is implemented by the DA and the Philippine Atmospheric, Geophysical and Astronomical Services Administration (PAGASA), with the support of the FAO. APA aims to develop climate-resilient agriculture (CRA) services and information using low-emission technologies. Expected outcomes include institutional capacity building for the development of CRA services, the adoption of CRA by farmers (notably by women, youth, and indigenous communities) and providing an enabling environment to mainstream CRA practices, services and decision support tools into DA programmes. The project builds on the Adaption and Mitigation Initiative in Agriculture (AMIA) programme, the flagship programme of the DA’s climate agriculture policy which enhances the uptake of CRA technologies and practices in rural areas. APA will be implemented until 2030 and is expected to reduce 4.38 MtCO₂eq over 20 years (USDA, 2023[13]; Green Climate Fund, 2023[14]) .

In 2023, the Land Bank (as GCF partner), the International Rice Research Institute and the World Agro-forestry (ICRAF) prepared a complementary project to the APA on “accelerating the adoption of climate-resilient agricultural production systems through integrative landscape approach to manage climatic risks”. This project, still in the design phase, addresses the technical and financial barriers to scaling climate resilient agriculture in the Philippines. It will support smallholder farmers at risk of climate change with:

• the development of investment packages for scaling up CRA practices and technologies

• accelerated uptake of finance

• strengthened capacities and knowledge management (Green Climate Fund, 2023[15]; Green Climate Fund, 2023[14]).

Trade policy developments in 2023-24

Temporary reductions on tariffs on rice (35% both in-quota and out-of-quota) and on maize (5% in-quota; 15% out-of-quota) and for pig meat were extended until the end of 2023 and later further extended to the end of 2024. These reductions are to mitigate the high inflation caused by supply constraints, the impact of ASF, to augment the supply of agricultural commodities in the country and diversify sources of supply. In addition, a reduced tariff rate of 5% for mechanically deboned or separated meat of turkey and chicken will be applied until 31 December 2024.

The Sugar Regulatory Administration (SRA) issued Sugar Order 1, which recommends allocating all raw sugar domestically produced to the domestic market in the current crop year 2023‑24 amid a projected 10% to 15% decline of production due to the El Niño phenomenon. Over the last three years, the country has not been able to take advantage of its export quota to the United States as it earmarked its entire domestic sugar production for domestic use (Department of Agriculture, 2023[10]).

In 2023, several temporary import bans were imposed to address concerns relating to animal disease. This included bans on domestic and wild birds (and products thereof) from Belgium, Chile, Czechia, Denmark, Ecuador, Ireland, Moldova, the Netherlands, Peru, Poland, Chinese Taipei and Türkiye due to HPAI outbreaks. Cattle-related imports were suspended from Brazil and the Netherlands due to the detection of mad cow disease. The Philippines issued temporary bans on the importation of wild and domestic pig meat and related products from Singapore and Sweden, among others, due to ASF.

After its ratification in February 2023, the Regional Comprehensive Economic Partnership (RCEP) entered into force on 2 June 2023 in the Philippines. The Bureau of Customs produced a Memorandum Order (CMO No. 12-2023) to guide importers and exporters on the issuance of proof of origin, application of differential tariff treatment and verification of procedures to support traders comply with the agreement’s provisions (Bureau of Customs, 2023[16]). In the agricultural sector, 15 out of 33 tariff lines for agricultural commodities in RCEP have tariff reductions foreseen. Most of the products covered are not produced in the Philippines (the relevant tariff lines account for 1.9% of the Philippines’ agricultural tariff lines and 0.8% of its imports).

In September 2023, the Philippines signed a bilateral Free Trade Agreement with South Korea, the third after the Philippines-Japan Economic Partnership Agreement signed in 2006 and the FTA with the European Free Trade Association (composed of Iceland, Liechtenstein, Norway and Switzerland) signed in 2016. The FTA with Korea improves market access for the Philippines for agricultural products such as bananas, processed pineapples and other tropical fruit, industrial products and selected services sectors. The FTA includes provisions for capacity building and technical co‑operation (including on smart farming) between both countries.

Policy context

Key economic and agricultural statistics

The Philippines is a mid-size country in terms of land area, but its population of 116 million makes it the world’s 13^th most populous country. Just under half, 48%, of Filipinos live in urban areas. With a median age of 25 years, the Philippines has a comparatively young population. At USD 10 133 in purchasing power parity (PPP), GDP per capita accounts for less than 40% of the average GDP per capita of all countries analysed in this report (Table 22.2). Overall, the Philippines’ economy is well integrated into international markets as measured by a ratio of trade to GDP of 28% in 2022.

Agriculture remains an important sector for the Philippines, but the sector’s 24% share in total employment compared to its 9.5% contribution to GDP highlights a significant gap in labour productivity. Farms tend to be small, with an average landholding of just 1.3 ha.

Table 22.2. Philippines: Contextual indicators

	Philippines		International comparison
	2000*	2022*	2000*	2022*
Economic context			Share in total of all countries
GDP (billion USD in PPPs)	268	1 171	0.7%	0.9%
Population (million)	78	116	1.8%	2.2%
Land area (thousand km2)	298	298	0.4%	0.4%
Agricultural area (AA) (thousand ha)	11 234	12 683	0.4%	0.4%
			All countries1
Population density (inhabitants/km2)	260	385	52	64
GDP per capita (USD in PPPs)	3 437	10 133	9 363	25 965
Trade as % of GDP	44.9	27.8	12.3	16.6
Agriculture in the economy			All countries1
Agriculture in GDP (%)	13.9	9.5	2.9	3.8
Agriculture share in employment (%)	37.1	23.7	-	-
Agro-food exports (% of total exports)	4.0	8.6	6.4	8.0
Agro-food imports (% of total imports)	7.3	14.0	5.8	6.9
Characteristics of the agricultural sector			All countries1
Crop in total agricultural production (%)	62	58	-	-
Livestock in total agricultural production (%)	38	42	-	-
Share of arable land in AA (%)	45	44	32	34

Note: *or closest available year.

1. Average of all countries covered in this report.

Sources: OECD statistical databases; International Labour Organization (ILO); UN Comtrade; World Bank, WDI; FAO database and national data.

Since 2012, the Philippines has achieved a relatively stable GDP growth of around 6% annually and enjoys comparatively low levels of unemployment that had been falling since 2015 to approach 2% in 2019 (Figure 22.4). However, due to the COVID-19 pandemic, the economy contracted by around 10% in 2020 and unemployment levels increased. In 2021, the Philippines’ GDP growth rate rebounded to 5.7%, close to pre-pandemic levels and increased again in 2022 to reach 7.6%. Inflation has been fluctuating. After lower rates in 2019 and 2020, inflation rose to 4% in 2021 and almost 6% in 2022.

The Philippines has been a consistent and increasing net agro-food importer since 2000. Still, agro-food exports have been growing over the last two decades (Figure 22.5). While agro-food exports plateaued since 2017, agro-food imports have continued to increase at a higher rate during this period. The significant increase in agro-food imports since 2020 has been driven notably by stronger imports of grains (wheat and rice), oilcake, meat and palm oil. Processed products for final consumption dominate the Philippines’ agro-food imports representing 40% of the total in 2022. In turn, processed products for the industry (mainly crude coconut oil) constitute an important export category, accounting for 41% of agro-food exports, followed by primary products for final consumption (mainly fruit such as bananas or pineapple).

Agricultural production increased in the Philippines by only 0.3% p.a. on average from 2012-21, well below the world average (Figure 22.6). This growth was driven mainly by above-average growth in intermediate inputs (0.5% p.a.), whereas the growth in total factor productivity declined further from the already low levels two decades earlier and is measured at 0.1% p.a. In turn, primary factor use declined (‑0.3% p.a.).

Agriculture remains the most important user of water, accounting for 79% of total water consumption in 2022. However, the sector’s share in total energy abstractions remains low (1.1%). Compared to 2021, the country’s nitrogen balance decreased in 2022. However, together with the country’s phosphorus balance it remains high compared to world averages.

Table 22.3. Philippines: Productivity and environmental indicators

	Philippines		International comparison
	1991-2000	2012-2021	1991-2000	2012-2021
			World
TFP annual growth rate (%)	0.3%	0.1%	1.7%	1.1%
			OECD average
Environmental indicators	2000*	2022*	2000*	2022*
Nitrogen balance, kg/ha	50.8	42.2	32.1	28.2
Phosphorus balance, kg/ha	7.7	9.3	3.3	2.3
Agriculture share of total energy use (%)	0.4	1.1	1.7	2.0
Agriculture share of GHG emissions (%)	29.2	..	8.7	10.1
Share of irrigated land in AA (%)	15.3	14.9	-	-
Share of agriculture in water abstractions (%)	82.4	79.0	47.0	49.5
Water stress indicator	..	..	8.7	..

Note: * or closest available year.

Sources: USDA Economic Research Service, Agricultural Productivity database; OECD statistical databases; FAO database and national data.

Historical trends in agricultural policies

Heavy government interventions in agricultural markets within a closed economy characterised the Philippines during the period from 1970 to 1986. The government had monopoly control over trade in rice, sugar and maize, operated by the National Grains Authority (NGA) established in 1972 (later renamed the National Food Authority [NFA]). Sugar trade was nationalised under the National Sugar Trading Corporation. At the same time, high-yield rice varieties were introduced and their use was encouraged with input subsidies, as was the use of fertilisers and pesticides. Public spending in the sector increased (particularly on irrigation), financed by a mix of taxes on major agricultural exports and foreign loans. Access to credit was facilitated by legally obliging financial institutions to provide 25% of their loans to the agricultural sector. Budgetary expenditures financed extension services to the farming sector (OECD, 2017[4]).

Partial liberalisation of the sector was implemented gradually from 1986 to 2000. Reforms undertaken in the 1990s aimed to improve services provided to agriculture, particularly extension services, and infrastructure. Market interventions were gradually reduced, as were tariffs and non-tariff measures on agro-food imports. The policy of self-sufficiency in rice continued with the provision of input subsidies to farmers, mainly for fertilisers and certified seeds, but also with credit facilitation and the provision of support to public services for agriculture, such as investments in irrigation and farm-to-market roads. At the end of the 1980s and in the middle of the 1990s, the Philippines negotiated two trade agreements: the ASEAN Free Trade Area and the Global System of Trade Preferences among Developing Countries. Upon joining the WTO in 1995, the country committed to removing quantitative restrictions on imports of sensitive agricultural products, with the exception of rice, and to gradual liberalisation of agro-food trade. Public expenditure on agriculture declined substantially in the late 1990s, due to tight fiscal policies adopted in the aftermath of the Asian Financial Crisis (OECD, 2017[4]).

Since 1988, the Philippines has undertaken an ambitious agrarian reform to redistribute agricultural land to landless farmers and land workers. The reform covered close to three-quarters of the country’s agricultural area. While the redistribution of land was effectively complete by the end of 2015, property rights remained unsettled and almost half of the reform beneficiaries still have collective ownership certificates instead of individual property rights.

During the 2000s, the government undertook policy measures to further reduce market interventions in agriculture. Subsidised credit programmes were terminated, and private traders allowed to import rice at limited levels. However, the focus on food (rice) self-sufficiency was reinforced and after the global food price crisis in 2008 spending on irrigation and input subsidies increased substantially. The Food Staples Sufficiency Programme, launched in 2011, retained a focus on rice and other selected staples, but shifted emphasis away from input subsidies towards providing public services to agriculture, such as extension and infrastructure (OECD, 2017[4]). Following the Uruguay Round Agreement on Agriculture, the system of quantitative restrictions for rice was abolished in March 2019 and replaced by a tariff rate quota system. The government established the Rice Competitiveness Enhancement Fund (RCEF) in 2019 to offset the effect of the liberalisation of rice imports on producers’ incomes. This fund has an annual appropriation of PHP 10 billion (USD 203 million) for six years (until 2025) and is financed with receipts from rice import tariffs. The RCEF supports purchases of farm machinery and equipment (50% of the budget), rice seed development and promotion (30%), subsidised credit to rice farmers (10%) and extension services (10%).

In 2018 the government established a comprehensive National Feeding Program Masustansyang Pagkain Para sa Batang Pilipino Act to address under-nutrition and nutrient-deficiency among children in public day care, kindergarten, and elementary schools. The programme includes several components: the School-based Feeding Programme (implemented by the Department of Education), the Supplemental Feeding Programme for children in day care (Department of Social Welfare and Development in co-ordination with local government units) and the Milk Feeding Programme (DA in co-ordination with the National Dairy Authority and the Philippine Carabao Center). In co‑operation with the Philippines Carabao Centre and the National Dairy Authority, a large portion of the targeted milk volume required by the programme was supplied by local dairy farmers and co-operatives.

Table 22.4. Philippines: Agricultural policy trends

Period	Broader framework	Changes in agricultural policies
Prior to 1986	Closed economy with heavy state interventions in agricultural markets and trade	Agricultural import tariffs; Export taxes on agricultural products State monopoly control over rice and maize trade (NGA, now NFA) Food self-sufficiency (rice and other staples); Increasing support to those commodities Nationalisation of sugar production; Creation of the National Sugar Trading Corporation
1986-2000s	Gradual reforms towards trade liberalization	Continued policy of food self-sufficiency (rice) Land reform started in 1988 (redistribution of land) National Sugar Trading Corporation reduced its functions and changed to the Sugar Regulatory Administration Investments in general services (irrigation, roads) Input subsidies declined due to the Asian financial crisis Removal of quantitative restrictions of all agricultural products except rice FTAs and WTO accession
2000-present	Minor policy change, some forms of state intervention in markets and trade maintained	Food self-sufficiency (rice) continues to be the main objective Quantitative quotas for imports of 14 agricultural commodities High tariffs of some agricultural products, particularly rice and maize Subsidised credit was dismantled Input subsidies for rice Import quantitative restrictions for rice abolished and replaced by import tariffs (2019) Increased budgetary support to rice producers

References

[12] Asian Development Bank (2023), Philippines : Food Voucher Program to Reduce Food Insecurity and Malnutrition, https://www.adb.org/projects/57138-001/main.

[16] Bureau of Customs (2023), Customs Memorandum Order (CMO) 2023, https://customs.gov.ph/customs-memorandum-order-cmo-2023/.

[6] Department of Agriculture (2023), Bureau of Agricultural Research, http://www.bar.gov.ph.

[10] Department of Agriculture (2023), Information sourced from the DA website, https://www.da.gov.ph/.

[8] Department of Agriculture (2022), Annual Report, https://www.da.gov.ph/media-resources/da-annual-reports/.

[3] Department of Agriculture (DA) (2022), Information provided to the OECD Secretariat by the Philippines Department of Agriculture.

[15] Green Climate Fund (2023), Accelerating adoption of climate-resilient agricultural production systems through integrative landscape approach to manage climatic risks (PILAR), https://www.greenclimate.fund/document/accelerating-adoption-climate-resilient-agricultural-production-systems-through-integrative.

[14] Green Climate Fund (2023), Adapting Philippine Agriculture to Climate Change (APA), https://www.greenclimate.fund/project/fp201.

[9] National Economic and Development Authority (2023), Philippine Development Plan, https://pdp.neda.gov.ph/philippine-development-plan-2023-2028/.

[11] National Food Authority (2023), Buying/Selling Price, https://nfa.gov.ph/buying-selling-price.

[4] OECD (2017), Agricultural Policies in the Philippines, OECD Food and Agricultural Reviews, OECD Publishing, Paris, https://doi.org/10.1787/9789264269088-en.

[1] UNCTAD TRAINS (2024), WITS (World Integraded Trade Solution), https://wits.worldbank.org/tariff/trains/country-byhs6product.aspx?lang=en.

[2] UNFCCC (2021), Republic of the Philippines, National Determined Contribution, Communicated to the UNFCCC on 15 April 2021, https://www4.unfccc.int/sites/ndcstaging/PublishedDocuments/Philippines%20First/Philippines%20-%20NDC.pdf.

[13] USDA (2023), Adapting Philippine Agriculture to Climate Change, https://apps.fas.usda.gov/newgainapi/api/Report/DownloadReportByFileName?fileName=Adapting%20Philippine%20Agriculture%20to%20Climate%20Change_Manila_Philippines_RP2023-0031.pdf.

[7] USDA (2023), Philippine Bt Cotton - 4th GE Crop Approved for Commercial Propagation, https://apps.fas.usda.gov/newgainapi/api/Report/DownloadReportByFileName?fileName=Philippine%20Bt%20Cotton%20-%204th%20GE%20Crop%20Approved%20for%20Commercial%20Propagation_Manila_Philippines_RP2023-0060.pdf.

[5] World Bank (2018), Growth and Productivity in the Philippines: Winning the Future, World Bank, Washington, D.C., https://hdl.handle.net/10986/30450.

Note

← 1.  Unconditional refers to policies and measures which can be undertaken using nationally mobilised resources. Conditional refers to policies and measures which require support or the means of implementation under the Paris Agreement.