The road to self-sufficiency: Upgrades to irrigation infrastructure will bolster food security

When typhoons Pedring and Quiel hit the Banaue Rice Terraces in Batad, Ifugao – a UNESCO World Heritage Site – in September 2011, its ancient irrigation infrastructure was severely affected, causing damage to crops, livestock and infrastructure estimated at P872m ($19.8m). The prominence of these natural disasters reignited calls for upgrades to irrigation systems to reduce risks to food production.

INFRASTRUCTURE IN FOCUS: The Banaue Rice Terraces are now the subject of a proposed rehabilitation and upgrading plan totalling P36m ($817,200). Across the country, heavy investment is required both to upgrade dilapidated irrigation systems and to expand flood mitigation projects to ensure the country’s ability to attain food security – an important national goal.

Thus, according to official data, the Philippines intends to raise its 2012 spending on agricultural infrastructure. In 2012, 62% of the Department of Agriculture’s (DA) budget, which exceeds P61bn ($1.38bn), will go toward infrastructure work, including the rehabilitation and construction of irrigation systems aimed at reducing dependence on external food supplies.

SUSTAINABLE GROWTH: In addition to rebuilding and rehabilitating storm-damaged areas, boosting irrigation spending is also aimed at drastically increasing crop yields, especially that of rice. This is an important issue for the Philippines, which is the largest per-capita consumer and importer of rice in the world. Food security became a priority in 2008, when the price of rice escalated globally due to export bans and panic buying. Indeed, some 84% of rice exports are controlled by only five countries – Vietnam, Thailand, Pakistan, India, and the US – according to an April 2011 briefing by the DA. Thus, the global rice trade is subject to the vagaries of export policy in these countries.

The country intends to reduce its exposure to external trade shocks by boosting domestic production. The Philippine Food Staples Self-Sufficiency Roadmap (FSSR) 2011-16 intends to achieve rice self-sufficiency for the country by 2013 and maintain this through 2016.

Increasing irrigation is expected to be a significant contributor to this goal, and the National Irrigation Administration (NIA) will be in charge of managing this aspect of the roadmap. In 2012 the NIA received the largest budget allocation in its history – P25bn ($567.5m), double its 2011 budget allocation .

“We are trying to get farmers to adopt what we call sustainable irrigated agriculture,” Bonifacio Labiano, chief of staff of the NIA, told OBG. “We want to increase the new irrigated area and rehabilitate the existing irrigation system.” The irrigation projects will allow for a huge increase in palay – un-husked rice – production.

The funding for the FSSP is coming from the national government and foreign assistance. Although initially it had been hoped that the private sector would participate extensively via public-private partnership (PPP) agreements, PPPs have contributed only P36.9m ($837,000) in the NIA’s 2012 budget strategy. This is largely due to the high investment required in infrastructure projects and the low, long-term returns.

FOREIGN ASSISTANCE: Meanwhile, for 2012, foreign-assisted projects will make up P4.4m ($99,880) of the total, while locally funded projects will contribute P20.3m ($460,810), according to NIA data. Of the NIA’s 15 foreign-assisted projects in calendar year 2012, the largest by far is the 7000-ha Agno River Integrated Irrigation Project (ARIIP) in Northern Luzon, which is contracted to China’s CAMC Engineering. This irrigation project will construct a dam and a regulating reservoir that, when completed, will provide year-round irrigation services to 34,450 ha of local farmland.

Another project in the works is the Balingasag River irrigation project in Northern Mindanao. Once completed, the P498m ($11.3m) irrigation system will serve 2500 ha of agricultural land, ensuring year-round palay production, and is expected to benefit more than 2000 farming families in Misamis Oriental Province. The completion of the irrigation system is expected to allow the province to attain self-sufficiency in palay production within the next two years, according to the DA.

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The Report: The Philippines 2012

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