With less than a month in office, President Duterte issued an executive order that will finally allow the government to use the controversial and long-disputed multibillion-peso coco levy fund. Signed on June 2, Executive Order No. 172, or the Coconut Farmers and Industry Development Plan (CFIDP), becomes the basis for tapping the P75-billion coco levy fund for various programs and projects to revive and modernize the coconut industry.
The CFIDP, which is to be reviewed annually, aims “to increase [the] overall productivity and income of coconut farmers, alleviate poverty, and achieve the twin objectives of rehabilitating and modernizing the coconut industry to attain social equity,” according to the EO.
The money to implement this blueprint will come from the Coconut Farmers and Industry Trust Fund (CFITF), which was set up through Republic Act No. 11524 signed by Mr. Duterte in February last year, using the recovered coco levy assets.
From 1971 to 1982, the government under deposed strongman Ferdinand Marcos Sr. imposed taxes and other fees on coconut farmers for selling copra. The collections were supposed to build up a fund to finance programs and projects to benefit the coconut industry, particularly small farmers.
However, in lawsuits filed by coconut farmers after Marcos Sr. fled in 1986, it was alleged that cronies of the Marcos administration had used the funds to finance their own business interests such as the United Coconut Planters Bank and shares in San Miguel Corp. to the detriment of millions of coconut farmers. But instead of giving back the coco levy fund to the farmers, the Supreme Court ruled in 2012 that the money belongs to the government.
The Philippines is the world’s top exporter of coconut products. Data from the Philippine Statistics Authority showed that the country’s exports of coconut products in 2021 reached nearly $2 billion, up by 58.7 percent from $1.23 billion the previous year. Coconut is planted in 3.6 million hectares across 69 provinces, with Davao, Zamboanga Peninsula, and Northern Mindanao being the top three producing regions. Coconut exports include coconut oil, copra meal, desiccated coconut, and oleo chemicals.
Despite this distinction, however, small coconut farmers remain among the poorest sectors of society. This may be due to their lack of adequate representation in the government agency overseeing the industry. Farmers’ groups have long been demanding stronger participation in the utilization of the coco levy fund. And while they welcome EO 172, they remain skeptical that it would benefit them at all.
Danny Carranza, secretary general of the national farmers’ group Kilusan Para sa Tunay na Repormang Agraryo at Katarungang Panlipunan, says that coconut farmers hope the implementation of the CFIDP will be “fair, transparent and participatory.” Given the guideline that the coco levy fund benefits will be provided only to organized coconut farmers’ groups, Carranza notes that “organizing and capacity building [among] small coconut farmers will be a serious concern [for] various government agencies,” adding that less than 5 percent of coconut farmers across the country are organized.
Mr. Duterte could have done better by completing the legal framework long before his six-year term was to end. Now that the EO had been issued, it would allow the incoming administration of President-elect Ferdinand Marcos Jr. to start implementing programs and projects to develop the coconut industry without the tedious legislative work needed to finally access the coco levy fund.
The Philippine Coconut Authority (PCA) has similarly completed in 2021 a coconut industry roadmap with the help of an expert team from the University of the Philippines Los Baños. “It was a product of painstaking consultations with various coconut farmers’ organizations, industry players, civil society, academe, concerned government agencies, local government units, and other stakeholders nationwide,” says administrator Benjamin Madrigal Jr. of the PCA, the agency tasked to implement the CFIDP. The next step is to flesh out details of the coconut industry blueprint crafted by the PCA, which the agency says will be formally launched within the month.
This is a golden opportunity for Marcos Jr. to correct a policy error during the regime of his father that had kept coconut farmers poor. He needs to ensure that the estimated 2.5 million small coconut farmers and their families will not be left behind in the implementation of the new industry roadmap, and that big stakeholders won’t be allowed to again dip into the coco levy fund for their personal interests.
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