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RA 11524: A gamechanger that will modernize, industrialize Phl coconut sector

Author: DA Communications Group | 27 February 2021

Agriculture Secretary William Dar welcomes the signing by President Rodrigo Roa Duterte of Republic Act No. 11524, or the Coconut Farmers and Industry Trust Fund Act (CFITF), saying the law will pave way for the efficient use of the multi-billion-peso coconut levy to uplift the livelihood of millions of farmers and sustain the development of the country’s coconut industry.

“On behalf of millions of coconut farmers and their families, we thank President Rodrigo Roa Duterte and our distinguished legislators for their continued guidance and strong support to revitalize the coconut industry,” Secretary Dar said.

With an ensured funding of P75 billion in the next five years, he said the CFITF is a historic “gamechanger” that will pave the way to modernizing and industrializing the Philippine coconut sector.

“This ushers in a new policy that will set in motion big reforms in the coconut industry using efficiently the proceeds of the coconut levy for the benefit of 2.5 million coconut farmers and their families, and the coconut industry in general,” he added.

President Duterte signed on February 26, 2021, RA 11524, which mandates the creation of a 50-year CFITF, as provided under a coconut industry development plan that is yet to be formulated by the Philippine Coconut Authority (PCA), an attached corporation under the Department of Agriculture (DA). When crafted, the plan has to be approved by the President.

“Likewise, we convey our sincerest gratitude to Senator Villar and Congressman Enverga for their astute leadership at both Houses of Congress in seeing the enactment of RA 11534,” the DA chief added.

The new law also reconstitutes and strengthens the PCA that is tasked to craft and implement a Coconut Farmers and Industry Development Plan (CFIDP).

Under RA 11524, the PCA Board will be chaired by the DA secretary and vice-chaired by the secretary of finance (DOF). Other board members include the respective secretary of departments of budget (DBM), science and technology (DOST), and trade (DTI); PCA administrator; and three members from the coconut farmers sector, representing Luzon, Visayas, and Mindanao.

Further, the CFITF is over and above the annual budget of the DA-PCA, which will continue to pursue its mandate of implementing programs and projects from the regular GAA appropriations.

The RA 11524 directs the Bureau of Treasury to transfer from the accumulated coconut levy at least P75 in the next five years to the CFITF: P10B each this year and in 2022; P15B each on 2023 and 2024; and P25B in 2025 plus any amount accruing, including interest of the coconut levy, in the special account in the general fund.

To formulate the CFIDP, the DA-PCA will be given an allocation of P5 million.

The law also creates a CFITF management committee composed of authorized representatives from the DOF, DBM, and DOJ.

The committee is tasked to set investment priorities, investment themes, asset allocation and policies; evaluate assets; issue guidelines for portfolio turnover and CFITF management expenses; set annual allocation of the CFITF; and approve financial requirements.

To date, the Philippines ranks as the world’s second-largest producer and number one exporter of coconut products. However, the coconut sector contributes a measly foir percent to the gross value-added in agriculture.

Among the major reasons of declining productivity in the coconut sector are dwindling areas and low yields.

Data from the DA-PCA show that total area planted to coconut has been declining through the years, estimated at 3.6 million hectares in 2018, planted to about 347 million bearing trees, that yield an average of 44 nuts per tree annually.

“While we are replanting with high-yielding coconut varieties, our efforts are not enough due to limited budget. But with the coconut industry trust fund, we could do much more,” Secretary Dar said.

“The transformation of the coconut industry requires getting our acts together by aligning our strategic measures with the new way of thinking taking place in agriculture. All of us need to look ahead and focus on the concerns of the impoverished rural sector, especially the coconut farmers,” he said.

“Now, more than ever, we must unleash the vast economic potentials of our coconut industry, and we need to continuously empower coconut farmers towards resilience and prosperity. This is the legacy that the Duterte administration wishes to bequeath to succeeding generations of Filipinos — a modern, industrialized, and globally competitive Philippine coconut industry,” he added.

For his part, DA-PCA administrator Benjamin Madrigal said in preparation for the enactment of RA 11524, the agency underwent an organizational transformation to make it into a more efficient, credible, and responsive institution in addressing the needs of coconut farmers and the challenges confronting the industry.

“Since last year, we have worked on the establishment and operationalization of regular regional and provincial industry fora, composed of coconut farmers’ groups, government agencies, local government units, and other stakeholders,” Madrigal said.

The fora serve as venue for reporting, coordination, information dissemination, and exchange of ideas, issues, and concerns to reach specific points of action and collaboration.

“Through these fora, the stakeholders will also craft their respective regional and provincial coconut industry development plan and will jointly determine the programs to be funded in their respective areas,” he added. ### (DA StratComms)

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