* My article in BusinessWorld on October 08, 2019.
“CARP has instead effected a massive de-formalization of agriculture! Time to allow agriculture to march out of the informal into the formal sector. It is time, in other words, to stop redistributing poverty!”
— Dr. Raul Fabella, “CARP: Time to Let Go,”
UPSE Discussion Paper 2014-02, February 2014
Unlike agrarian reform in Japan, South Korea, and Taiwan that lasted only for several years before forced land redistribution was halted, the Philippines’ agrarian reform is endless, with no timetable — a forever program.
Former President Marcos declared his own agrarian reform in 1972 and when he was ousted, former President Cory Aquino implemented another version, the Comprehensive Agrarian Reform Program (CARP, RA 6657, June 1988). CARP should have ended by 1998 but it was extended under RA 9700 (August 2009). So from 1972 to 2019, there have bee 47 years of agrarian reform and there is no plan to end it.
Endless agrarian reform is wrong because it creates endless business uncertainty in two sectors, agribusiness and mass housing programs.
First, an agribusiness person develops an idle or ugly piece of land into a productive, revenue-earning fruit orchard. Rural jobs are created, food production is expanded, and that is also where the Department of Agrarian Reform (DAR) can come, knock on the person’s door to inform him/her that the land will soon be forcibly distributed to the workers. And this contributes to why many rural areas remain planted to traditional low-value crops.
Second, real estate developers endure many years of waiting for the DAR to approve land conversion from agricultural to mass housing projects.
I spoke with Jeffrey Ng, a fellow alumni of the UP School of Economics (UPSE) and President of our UPSE Alumni Association. He is also the Chairman of the Subdivision and Housing Developers Association (SHDA). Jeff said that they have to “get approval from National Irrigation Administration, Philippine Coconut Authority, Sugar Regulatory Administration, then the Department of Agriculture itself. Only then can we apply for actual conversion with DAR. After which comes LGUs, DENR (Department of Environment and Natural Resources) and HLURB (Housing and Land Use Regulatory Board). All these delays cost money and interest, which unnecessarily raises the cost of socialized and mass housing projects.”
President Rodrigo Duterte has ordered that this entire land conversion process should not take more than 30 days. Jeff said that it can be done if all these government agencies and departments will put up a one-stop shop under the new Department of Human Settlements and Urban Development.
Some 6.5 million Filipino families do not own a house yet, so the supply of buildable land for affordable mass housing should increase. And DAR and endless agrarian reform is part of the problem. This is agrarian and property leftism.
Related to this is the low score and global ranking of the Philippines in property rights protection like land. Small- and medium-size landowners are unsure if they can continue ownership and control of their land in the next 10 or 20 years.
In the International Property Rights Index (IPRI), an annual study by the Property Rights Alliance (PRA, Washington DC), the Philippines ranks low. The index is composed of three components: Legal and Political Environment (LPE), Physical Property Rights (PPR) and Intellectual Property Rights (IPR). LPE has four sub-components, IPR has three, and PPR also has three — Protection of physical property, Registering property, and Ease of access to loans.
In overall IPRI, the Philippines ranked 77th out of 118 economies in the 2010 Report, improved to 70th out of 125 economies in the 2018 report. In PPR, the Philippines has significantly improved over these years, ranked 80th in the 2010 Report and 63rd in the 2018 Report (See Table).
IPRI 2019 will be launched on Oct. 16 at Fairmont Hotel. How will the Philippines rank then, both in IPRI overall and PPR?
Report author, Dr. Sary Levy-Carciente, an economist from the Universidad Central de Venezuela, and a Fulbright Visiting Scholar at Boston University, Center of Polymer Studies, will come to discuss the report. PRA Executive Director Lorenzo Montanari will accompany her. The local partners of this event are the Foundation for Economic Freedom (FEF) and Minimal Government Thinkers.
The words of Dr. Fabella, a National Scientist, my former teacher, and our former Dean of UPSE, should be heeded by legislators and the administration, to finally end the endless forced redistribution of private lands.