January 23, 2008 | 12:00am
Agricultural Secretary Arthur Yap welcomes the entry of foreign investments in the agricultural sector to fill a financing gap created by the lack of domestic investors in the countryside.
In a press briefing, Yap said there is a need to come up with some sort of a “modus vivendi” to open the gates for more foreign investments in the agricultural sector.
Yap was referring to the still pending decision on whether to proceed or cancel several agricultural deals with Chinese firms. The deals were suspended last year due to protest from several farmers’ group.
According to Yap, the Arroyo administration is still working on some “structure to work within.”
The DA has been holding consultations with involved stakeholders from November to December last year to resolve concerns about the Chinese investments in the agricultural sector.
Several Chinese deals signed during President Arroyo’s trip to Shanghai, China last year were suspended as an offshoot of the cancellation of the controversial National Broadband Network (NBN) deal with Chinese firm ZTE and protests by local farmers’ group.
Among the deals suspended were the framework Agreements signed by members of the Convergence Initiative and parties such as Jilin Fu Hua, Guangxi Zhuang Autonomous Region Government and Beidahuang Seed Co.
The framework agreement with Jilin would involve the development of one million hectares of land for hybrid corn, rice and sorghum, while the deal with Guangxi would involve the similar development of 40,000 hectares of land for sugarcane and cassava for renewable energy projects.
Yap pointed out that the agriculture sector is not getting enough investments.
He cited Bangko Sentral ng Pilipinas (BSP), data showing that only 5.7 percent of all loans released in the Philippines by banks go to agriculture.
On the other hand, The agriculture sector, has 35 percent of the total labor force and accounts for 20 percent of gross domestic product (GDP).
Yap noted that investors in the agriculture have a lot of questions and fears and want clarification on the lease of agricultural lands to Chinese investors and what they will be investing in.
Yap said, “I think that the Chinese companies and Chinese government also understand that we’re being transparent and we’re expanding consultation on this matter.”
“The project is not cancelled — at least for the agriculture side, and yet we still believe that we have to engage in consultations, ” Yap said, adding that he would call for consultations by “end-October to November, December. Before the year’s out, I’m expecting to have some results on this matter.”
A final decision on the Chinese deals is supposed to be announced this year.
