Food security is popularly defined as the availability of affordable food for the population at all times. However, the concept is often argued about from between two extremes. On the one hand, politicians, policy-makers, and program implementers equate food security with self-sufficiency, where food security is achieved through domestic production at all costs. On the other hand, academics, notably neoclassical economists, argue food security as an affordability issue, that is, it is not necessary for a society to be self-sufficient to be food secure. Food security can be achieved through trade. Availability and affordability can be achieved through price and income policies.

This dichotomy, however, is an oversimplification. Often, the argument is focused on politically sensitive agricultural commodities like rice; hence, arguments are limited to rice sufficiency or affordability. In reality, food security must be viewed beyond politically sensitive cereal crops like rice because, technically, apart from cereal food crops, the food basket includes milk products, meat (poultry and livestock), fish, vegetables, and fruits. If the argument includes other commodities, then the dichotomous argument of sufficiency versus affordability is no longer appropriate.

Prof. Gordoncillo

Because the food basket includes commodities other than rice, in practice, food security policies are anchored on a combination of economic and political arguments. For politically sensitive crops like rice, self-sufficiency has been the common practice in most countries in the region. To emphasize this argument, the situation in Japan can be cited. The Japanese people, due to the political goal to achieve self-sufficiency in rice, are willing to pay about 8-10 USD per kilogram of rice. It is obvious that the policy-makers in Japan are not oblivious to the validity of the market efficiency argument based upon economic doctrines. Under the free market framework, it can be proven that Japanese consumers can easily enhance their economic welfare if they simply buy rice from the rest of the world at 0.50 USD per kilogram. However, for some other agricultural commodities, the Japanese society is open to trade. For instance, the Philippines exports bananas to Japan.

The same combination of both political and economic arguments can be adopted to inform food security policies of the country, which must be guided by self-sufficiency. In fact, technically, the country has been self-sufficient in rice production.

Historically, the volume of rice imports on the average is about ten percent of the country’s total rice consumption. On the production side, experts estimate that losses to post-harvest inefficiencies have been about 18-25 percent. Hence, addressing the efficiency of post-harvest facilities and practices can readily resolve the rice self-sufficiency problem. This argument, however, does not imply putting productivity enhancement interventions aside. In the long run, the level of productivity has to cope with competing land uses and population pressure.

Economic efficiency arguments can be the guiding principle for the other commodities where the country obviously does not have comparative advantage in production. For instance, the country does not have sufficient grazing areas to support a beef and dairy industry. We would be better off using our lands to produce other suitable crops than to use the same for grazing cattle to produce milk. We can increase our output in other agricultural products like fruits and trade it for dairy products from Holland.

Within the boundaries of the policy framework outlined earlier, specific policies can be adopted to enhance food security both in terms of the political and economic goals of the society. In the short run, the issues on post-harvest losses must be addressed. Studies have shown that in the case of rice, the most significant proportion comes from losses in drying. The current program providing farmers access to mechanical dryers is a move in the right direction. However, the program must be reviewed in terms of how it was implemented. For instance, in the distribution of access, the selection criteria must be strengthened to incorporate rainfall patterns and volume of production.

Given current technology, there is a need to at least ensure the level of production, if not enhance the level of productivity. To achieve these, investments in irrigation facilities must be made. For a very short period in the early 1980s, the country was a net exporter of rice. This coincided with significant spending in irrigation facilities. In recent years, expenditures in irrigation have, in relative terms, been insignificant.

Land area devoted to rice production must also be maintained; hence, there is a need to protect prime agricultural lands, particularly those with public investments like irrigation. The problem here is that the power to approve land conversion is vested in the Department of Agrarian Reform (DAR) within the framework of preventing the diminution of the scope of the Comprehensive Agrarian Reform Program (CARP). Land conversions have broader implications on food security which are beyond the capabilities of DAR. Hence, the power to approve land conversion must be removed from DAR and transferred to other government agencies with the capabilities to assess the broader implications of land conversion on food security in particular and society in general.

The other critical issue that must be addressed is the National Food Authority (NFA). The main function of the agency is to ensure food security by stabilizing both the supply and price of rice¹. This is supposed to be done by buffer stocking and rice subsidy. In 2008, an Asian Development Bank (ADB) economic paper estimated that the total cost of the entire NFA program was roughly PhP167 billion or 2.5 percent of GDP². This is much higher than the total share of the R&D expenditures for the entire country. To put it in another way, the estimated cost for 2008 alone is higher than the total amount spent for CARP in the last 22 years. With this level of expenditures as context, it is worth noting that the estimated procurement of local rice production is about 11 million bags. This is less than one percent of the total domestic output annually. It will not require an advanced PhD degree to figure out that at the current level of procurement, the intervention will not have a significant impact on the stability of both the price and supply of rice.

Experts have long been advocating the abolition of the agency. The advocacy failed because of the resistance of politicians and bureaucrats who stand to benefit from the lucrative rent-seeking opportunities generated (as part of standard procedures or by design) in the operations of NFA. The abolition will stop the leakage of government resources and the huge allocation for the agency can be used in more effective rice security interventions such as irrigation facilities and productivity-enhancing support services like technology promotion and financial assistance to rice farmers.

Finally, in the area of non-rice food security, it has long been established that informal agricultural trade or smuggling is rampant in the country. Smuggling in whatever mode results in a negative net effect on the society as a whole. First and foremost, informal trading reduces the revenue that the government can generate, which could be used to provide for basic services for the country. The entry of cheaper-priced smuggled goods reduces the competitive advantage of local producers. Consequently, the capacity of the domestic economy to generate more employment is adversely affected and the livelihood of small farmers is practically wiped out due to the undue advantage of smuggled goods. In the late 1980s, it was estimated that the extent of smuggling totaled about USD6 billion. More recent calculations estimate the volume of smuggling to be about USD10 billion³. This massive volume of illegal trade, no doubt, affects adversely the country’s food security conditions.

Smugglers are businessmen. Businessmen assess the profitability of their enterprises on the basis of the risk involved. Currently, aside from the laxity of legal enforcement, the penalties associated with smuggling activities are so light that they are viewed as non-deterrents to the enterprise of smuggling. In fact, in Mindanao, the common practice is to set up decoys for the authorities to catch so that the real vessels with the smuggled commodities can avoid detection. Measures to effect stricter law enforcement and amendments to the existing statutes must be pursued.

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The author is an assistant professor at the Department of Agricultural Economics, College of Economics and Management, UPLB. Email him at pugordoncillo@yahoo.com.ph.

NOTES:

¹ As pointed out earlier, the official translation of the government’s agenda in food security is rice security. This is apparent in the operationalization of NFA’s mandate. The agency is mainly concerned with ensuring sufficient buffer stock and stabilizing the price of rice.

² The paper, which was written by Shikha Jha and Aashish Mehta and part of the ADB Economic Paper Series, provided an in-depth analysis of the NFA program by looking at the Family Income and Expenditure Survey.

³ The 1984 estimate was done by Beinvinido Alano in his paper in the Journal of Economic Development, published by the Philippine Institute of Development Studies. The more recent estimate was drawn from the arguments of Mong Palatino at UPI Asia.com.

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