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No Free Lunch

It’s coordination, stupid!

Development planning may be seen as an effort to coordinate actions of government, private sector and civil society to uplift everyone’s wellbeing via outcomes that bring about the greatest good for the greatest number. The key word is “coordinate.”

It’s a challenge enough to achieve coordination across the three stakeholder groups of government, private sector and civil society; across economic sectors (agriculture, industry and services); or across industries (say, manufacturing, logistics and power). But when coordination fails even within the same group (say, within government itself, or within agriculture itself), then we really are in trouble.

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The National Economic and Development Authority (Neda) recently organized an Agri-Industry Research Forum to take stock of our knowledge base in agriculture and agribusiness. I came out of that forum seeing no lack of research-based knowledge to achieve the level of agri-industrial dynamism already attained by neighbors like Thailand and Vietnam. After all, we can say that these neighbors learned their agriculture from us, having sent many students to the University of the Philippines Los Baños, erstwhile Southeast Asia’s knowledge center for the agricultural sciences. Thus, we know what’s needed to solve our problems in agriculture/agribusiness; we just can’t seem to do things right.

The crux of the problem lies in governance, the focus of the last session in the Neda forum, and research has not been wanting even in that area. Dr. Nerlita Manalili drew her presentation from previous studies on governance and regulatory management in the sector, and lying at the heart of the governance problem is lack of coordination.

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Random examples include, among many others: lack of personnel for critical regulatory and accreditation agencies like the Food and Drug Administration (FDA), even as there are inadequate testing facilities/laboratories to examine food and nonfood agricultural products for marketworthiness; conflict of interest in certain agriculture agencies with both regulatory and promotional functions; weak agricultural insurance system contributing to poor credit access by farmers; duplicating or overlapping regulatory requirements; and disjointed policy and program support for the various links in the agricultural value chain.

On regulatory overlaps, a favorite example that used to be cited by former Customs commissioner Sunny Sevilla was the need for importers of Toblerone (or milk chocolate candies with nuts, in general) to obtain prior clearance from the FDA, the Bureau of Animal Industry because the product contains milk, and because it also contains nuts, from the Bureau of Plant Industry as well—when all three could simply coordinate and consolidate their permits into one.

On value chain support, our problem is that the Department of Agriculture (DA) considers anything that happens beyond the farm gate to be the responsibility of the Department of Trade and Industry (for processing), or the Department of Transportation (for logistics).

A long suggested fix for the regulatory issue is to consolidate all agriculture-related regulation functions into one apex regulatory agency within the DA. This would not only address the conflict of interest issue in certain DA bureaus, but would also address the regulatory overlaps and duplication that raise the cost of doing business in our country. I’ve written before of a long suggested solution to address the interdepartment coordination problem that prevents holistic value-chain oriented support for agribusiness, which is to follow the examples of Malaysia, Vietnam and many other countries: Rather than just a Ministry of Agriculture, Malaysia has a Ministry of Agriculture and Agri-based Industries, and Vietnam has a Ministry of Agriculture and Rural Development.

We must also foster industry associations that bring together members from various links in the value chain, rather than have separate associations for farmers, traders, food processors or truckers.

If we are to have tighter coordination in the governance of agriculture/agribusiness in government and in the private sector, these would be good ways to start.

cielito.habito@gmail.com

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TAGS: Agri-Industry Research Forum, agribusiness, agriculture, Cielito F. Habito, development planning, NEDA, No Free Lunch
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