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RURAL POVERTY in the PHILIPPINES The Philippine population has reached over 100 million following an increasing poverty incidence for the more than five years. According to Asian Development Bank (ADB), 2009, one in every four Filipinos or one in every five families is living below the poverty line with 25.8% poverty incidence in 2015.Those who are included in the poverty line are those who were not able to meet the required poverty threshold or the required minimum income/expenditure in order to provide the basic food and non-food (i. e., clothing, housing, and transportation, health, and education expenses) necessities and to be considered as non-poor (www.nscb.gov.ph). ADB, 2009 identified the causes of poverty as follows: 1. Low to moderate economic growth for the past 40 years; 2. Low growth elasticity of poverty reduction; 3. Weakness in employment generation and the quality of jobs generated; 4. Failure to fully develop the agriculture sector; 5. High inflation during crisis periods; 6. High levels of population growth; 7. High and persistent levels of inequality (incomes and assets), which dampen the positive impacts of economic expansion; and 8. Recurrent shocks and exposure to risks such as economic crisis, conflicts, natural disasters,and “environmental poverty. On the other hand, they characterize poor as: 1. The majority live in rural areas and work in the agriculture sector, mostly as farmers and fishers 2. In the urban areas, such as Metro Manila, they are found in slums and the informal sector. 3. They have large families (six members or more). 4. In two-thirds of poor families, the head of household has only an elementary education or below. 5. They have no or few assets and minimal access to credit. 6. A major income source of the poor is from enterprise income (informal sector activities). 7. A significant segment of the poor households are “chronically poor.

More than half of the population in the Philippines live in rural areas. Poverty in rural areas is more than three times higher than the percentage in the urban areas leaving widening poverty gap between them. Moreover, there is higher illiteracy, underemployment and poverty incidents but less access to productive assets and business opportunities among people in rural areas that cause lag in economic growth. They have few non-farm income-generating activities, and people lack access to microfinance services and affordable credit. Overall, a quarter of the people in the Philippines live in poverty.The poorest of the poor are the indigenous peoples, small-scale farmers who cultivate land received through agrarian reform, landless workers, fishers, people in upland areas and women. The people in the uplands of the Cordillera highlands and Mindanao Island are among the poorest in the country. Among the causes of rural poverty are a decline in the productivity and profitability of farming, smaller farm sizes and unsustainable practices that have led to deforestation and depleted fishing waters. Moreover, higher underemployment in rural areas are cause by lack of educational attainment thus, people continue to resort to fishery and farming. Commercial establishments and other financing organizations are more common in the urban areas making community in the rural to get monetary assistance to support their livelihood needs. Furthermore, there is a higher rate of underemployment in the rural areas while in the urban areas, the issue is diverted to the level of unemployment. Despite the intense labor needed to sustain such livelihood, it continues to provide lower wages than those from other sectors.


ERRADICATING POVERTY in the PHILIPPINES According to the study conducted by Organization for Economic Co-operation and Development (OECD), focusing on the improvement in the agricultural sector in countries with high poverty rate is an effective way to reduce the problem. They conducted surveys in 25 countries including Brazil, Cameroon, Chile, China, Costa Rica, Dominican Republic, Egypt, Gambia, Ghana, Guatemala, Honduras, Indonesia, Kenya, Malaysia, Mali, Mauritania, Mexico, Nicaragua, Panama, Philippines, Senegal, Tajikistan, Thailand, Tunisia and Vietnam and found out that agriculture provides a great potential to reduce poverty. It provides more employment and at the same higher rate of food security. On the other hand, in the study conducted by Australian Centre for International Agricultural Research (ACIAR), it is insufficient to say that developing countries with high poverty rate will not be able to succeed without taking measures from agriculture. It is not enough to give higher regards to sectors such as industry, commercials and manufacturing and give less importance to agriculture. Empowering the farm-sector community is a first step to awaken the long before potential that agriculture can provide in eradicating the issue on poverty (http://www.oecd.org/indonesia/ agriculturalprogressandpovertyreduction.htm).

Poverty reduction is one of the highest priorities of the Philippines over the past three decades. The current Philippine Development Plan (PDP) 2011-2016 adopts a framework of inclusive growth, which is high growth that is sustained, generates mass employment, and reduces poverty. The PDP Midterm Update realigns the government’s strategies to craft and implement concrete solutions to the country’s problems, and speed up the creation of high quality jobs, reduce poverty and achieve inclusive growth. The approach in poverty reduction is ensuring people’s access to health, education, water, sanitation, and secure shelter, among others.

Meanwhile, FAO saw a positive relationship between agriculture and poverty alleviation in achieving the project for MDG. Despite the fact that most poverty incidence exist in rural areas , it is where agriculture is being practiced which should be given a higher priority since it provides a promising outcome in order to reduce the presently issue of poverty reduction.


SECONDARY CORDILLERA HIGHLAND AGRICULTURAL RESOURCE MANAGEMENT PROJECT (CHARMP) Total project cost: US$66.4 million IFAD loan: US$26.6 million IFAD grant: US$561,000 Duration: 2008-2015 Directly benefiting: 12,530 households Cofinancing: Asian Development Bank (US$10.0 million), OPEC Fund for International Development (US$10.0 million)

This project builds on the first Cordillera Highland Agricultural Resource Management Project (CHARMP), which has contributed to reducing poverty among indigenous peoples in the highlands of the Cordillera Region in the northern Philippines. The second CHARMP innovative combination of emergency assistance and a development project concentrates on areas where poverty is most severe in all six provinces of the region: Abra, Apayao, Benguet, Ifugao, Kalinga and Mountain Province. The aim is to reduce poverty and improve the livelihoods of indigenous peoples living in farming communities in the mountainous project area. The indigenous peoples consist of many tribes whose main economic activity is agriculture. More than half of the people in the area are poor. Moreover, it introduces new forms of innovation such as commercialization of indigenous peoples’ products through value chain development and market linkages.

It also strengthens participatory systems of monitoring and evaluation of project activities, and the capacity of indigenous peoples and their councils of elders to assume responsibility for forest management. In addition, the project empowers municipalities to authorize project disbursements to agencies implementing activities.The objectives are to: • increase household income of poor farmers through sustainable agriculturaldevelopment • enhance the quality of life in the communities by improving land tenure security, food security and watershed conservation.


RAPID FOOD PRODUCTION ENHANCEMENT PROGRAM (RaFPEP) Total cost: US$42.2 million IFAD loan: US$15.9 million Directly benefiting: 763,889 households Cofinancing: European Commission (US$13.1 million), Food and Agriculture Organization of the UN (US$0.5 million), to be determined (US$0.5 million)

This project will support the government’s 2009-2013 Rice Self-Sufficiency Plan, a nationwide effort to regain self-sufficiency in rice production and to respond to the food price crisis that emerged in 2008. IFAD’s investment will provide support for securing good quality seed to boost rice production and for rehabilitating and developing irrigation works. The programme includes two subprograms that are separate but mutually dependent such as the Rapid Seed Supply Financing Project (RaSSFiP), implemented in 2009 and the Irrigated Rice Production Enhancement Project (IRPEP), to be implemented from 2010 to 2015 The programme targets poor paddy farmers and poor irrigators’ associations in various rice-growing areas, with the objective of achieving an increase in paddy production. The RaSSFiP focused on acquisition and distribution of certified seeds for the 2009 wet season crop while IRPEP will work in the longer term to strengthen irrigation associations, provide production inputs and support services, develop and maintain irrigation and rural infrastructure, develop marketing and the post-harvest stage of production and promote policy dialogue.

IFAD will directly supervise the programme, which is an innovative combination of emergency assistance and a development project. It brings together an urgent response to prevent an emergencyby supplying seeds rapidly to increase paddy production, and a mediumterm irrigation rehabilitation effort that aims at increased and sustained production. Through the financial package, IFAD will provide funds for the urgent phase and play a catalytic role in further financing. And IFAD’s support for the government’s sector-wide programme enables both IFAD and the government to fast track processing, providing a potential model for future initiatives.


INTEGRATED NATURAL RESOURCES and ENVIRONMENTAL MANAGEMENT PROJECT (INREMP)

This project aims to improve the condition of watersheds and the livelihoods of poor rural people in four priority river basins, selected on the basis of their biophysical condition, socioeconomic and conservation values and state of degradation. The project is targeting 23 watersheds in nine provinces, comprising over 1.13 million hectares with an estimated population of around 2.7 million. In the selected watersheds, it will reduce degradation caused by deforestation and unsustainable farming practices, while generating tangible economic benefits. The project will benefit approximately 220,000 people – the majority from vulnerable and marginalized sectors – with a particular focus on indigenous peoples and resource-poor. Mechanisms to achieve these objectives are: • Payments for water regulation, soil conservation, carbon offsets and biodiversity • Income-generation from sustainable use and management, and value added processing of forest products

• Improved natural resource productivity and climate resilience. Total project cost: US$148.6 million IFAD loan: US$20.0 million Directly benefiting: 44,000 households Cofinancing: Asian Development Bank: US$100.0 million Global Environmental Facility: US$2.5 million AsDBank:Climate Change Fund: US$1.4 million


Northern Mindanao Community Initiatives and Resource Management Project (NMCIREMP) Total cost: US$21.6 million IFAD loan: US$14.8 million Duration: 2003-2009 Directly benefiting: 58,500 households

Highland Agriculture Development Project (HADP) Total cost: US$26.9 million IFAD loan: US$4.6 million Duration: 1987-1993 Directly benefiting: 6,600 households Cofinancing: Asian Development Bank (US$18.8 million)

Rural Microenterprise Finance Project (RMFP) Total cost: US$64.8 million IFAD loan: US$14.7 million Duration: 1996-2002 Directly benefiting: 300,000 households Cofinancing: Asian Development Bank (US$20.0 million) Western Mindanao Community Initiatives Project (WMCIP) Total cost: US$18.2 million IFAD loan: US$14.8 million IFAD grant: US$0.75 million Duration: 1999-2007 Directly benefiting: 16,000 households

First Cordillera Highland Agricultural Resource Management Project (CHARMP) Total cost: US$41.5 million IFAD loan: US$9.2 million Duration: 1996-2004 Directly benefiting: 23,150 households Cofinancing: Asian Development Bank (US$19.1 million) Visayas Communal Irrigation and Participatory Project (VCIPP) Total cost: US$21.7 million IFAD loan: US$15.1 million Duration: 1992-1999 Directly benefiting: 11,600 households Cofinancing: Desenvol. Integral Sud-Ouest Do Parana Brazil (US$0.75 million), Netherlands (US$1.5 million), UN Development Programme (UNDP) (US$0.6 million) Smallholder Livestock Development Project (SLDP) Total cost: US$12.7 million IFAD loan: US$8.0 million Duration: 1982-1989 Directly benefiting: 34,000 households Cofinancing: Asian Development Bank (US$2.6 million)

Magat River Multipurpose Project Stage II (Irrigation) (MRMPS II) Total cost: US$62.0 million IFAD loan: US$10.0 million Duration: 1979-1984 Directly benefiting: 12,400 households Communal Irrigation Development Project (CIDP) Total cost: US$121.8 million IFAD loan: US$12.0 million Duration: 1983-1990 Directly benefiting: 24,000 households Cofinancing: World Bank: International Bank for Reconstruction and Development (IBRD) (US$71.1 million)


International Fund for Agricultural Development