Neglect in Agriculture Results Poor MSME Performance

by ERNESTO T. SOLIDUM

Small and Medium Enterprise Development topic discussed on January 23, 2010 at Kapehan Sa Aklan held at Smokehaus Resto and Bar. Ms. Stella R. Caldera, Trade & Industry Development Specialist, DTI and Ms. Amelia S. Rentillo, President, Hugod Aklan were the invited guest resource persons.

Republic Act (RA) 6977 as Amended, known as Magna Carta for Micro, Small and Medium Enterprises is the legal basis. It is the policy of the state to promote, support, strengthen and encourage the growth and development of micro, small and medium enterprises (MSME’s) in all productive sectors of the economy particularly rural/agri–based enterprises. The MSME’s have the potential for more employment generation and economic growth and therefore can help provide a self sufficient industrial foundation for the country.

The Department of Trade and Industry (DTI) is mandated to promote and support entrepreneurship and encourage the establishment of MSME’s. The success of the program will usher in massive countryside industrialization.
Under this Act, micro industries has an invest-ment of less than P3 million, small from P3 to P5 million and medium P15 to P100 million. There are 18 major industrial divisions among which are: agriculture and forestry; manufacturing; electricity, gas and water supply; construction; wholesale and retail trade; hotel and restaurants, transport, storage and communication, among others.

Dr. Ambrosio R. Villorente mentioned that out of 92 million population there are 35 million Filipinos that constitute the labor force. Yet, 2.8 million are jobless. Ironically, real farmers who constitute the largest sector is viewed as inept or indifferent to entrepreneurial development. Based on contest winners, agri-business personalities are either doctors, lawyers, retired military personnel, politician, OFW"s who are genuinely receptive to modern agricultural practices. They engage in agri-business and apply science and technology in their farms.

Atty. Ronquillo C. Tolentino said that Aklan has a good investment climate for priority areas in power, water, and telecommunication. More investments would certainly generate employment, revenues, and hasten economic recovery.

Ms. Rentillo reported that based on revenue generation, the recent Ati-Atihan trade fair resulted to P1.4 million sales, a 10 percent increase over last year. Hugod Aklanon displayed the latest in design, originality, artistry, durability, comfort, and affordability in their products. Saleable ones were bags, slippers, piña embroidery, food preserves and other souvenir items. Most of the product lines in the showcase bore distinctly Aklan workmanship. Piña garments carry official seal of excellence.

Ms. Caldera said that it’s hard to believe that for the first few days, practically business was sluggish but eventually Saturday and Sunday (January 16 – 17) proved heavy. Confirmed orders are from Scotland (piña cloth), Iloilo (VCO) and Shangrila Hotel Boracay (Bayong). The DTI specialist however, bewailed the fact that many resort establishments in Boracay are not being reached by local manufactured products.

In the last Kapehan forum, Ms. India C. Legaspi revealed there are 35 industries registered with DTI. Majority of which are in the piña cloth industry where they employ some 10,000 people. She said, for the past three decades there was steady expansion and development in product design and quality. Calvin Klein, a leading fashion company in New York, USA is consistent prime buyer of Aklan made piña products.

Prior to RA 6977, there were already numerous laws to fast track and strengthen MSME’s like RA 8425 (Special Reform and Poverty Alleviation Act, RA 9178) (Barangay Micro Business Enterprises Act of 2002), RA 7844 (export Development Act) and RA 7882 (An Act Providing Assistance to Women Engaging in Micro Enterprises and Strengthening Existing Ones).

It is sad to note that after more than a decade of implementation, only 35 industries are registered with DTI, Aklan. Hackneyed rhetoric is shortage of funds and personnel. This is just a lame excuse for inefficiency and complacency. Job accomplished so far is just barely scratching the surface. Definitely more enthusiasm and hard work must be done to cover lost ground. As a member of World Trade Organization we need to be globally competitive i.e. products of excellence and affordable.

Meanwhile, Ms. Gilda E. Pico, President and CEO of Land Bank of the Philippines (LBP) graphically portrays our national economy as a pyramid where the base is agriculture, middle are industries and the apex are services. The economics of most if not all advanced countries in the world like the United States, Europe, and Asia were developed bottom up. They first worked at strengthening their agriculture sector.

Eventually, they moved to the industrial sector. Thence, the services. Leading industrial nations are into refinement of its services in banking, insurance, telecom-munications, shipping and transport. The LBP executive said that rational development for the country should necessarily follow the developed nations’ path or model. Any other option could only meet frustrations and failure.

The attempts of previous government to industrialize the Philippines utterly failed to achieve their noble aims. Undoubtedly, the resources are there but the alchemy that makes it realistic simply does not exist. It would be best to assess our priorities from a better perspective acknow-ledging that agriculture needs strengthening, modernizing, and coor-dinating with other sectors. Having accomplished this feat, surely industria-lization will follow.

There is the urgent necessity to infuse more motivation in farming to cajole the young people to engage in agricultural enterprises employing the recommended farming methods. /MP