MSMEs for agriculture

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DR. WILLIAM DAR

The role of Micro, Small and Medium Enterprises (MSMEs) in the development of the country’s agriculture sector can never be overlooked, but much needs to be done to establish more MSMEs, especially if investors and businessmen are not aware of the potentials of agripreneurship.

The role and importance of MSMEs will also be discussed during the Asean Business Advisory Council’s (ABAC) hosting of the very first “Prosperity for All Summit” that is part of the 30th Association of Southeast Asian Nations (Asean) Summit on April 26-29.

Scheduled on April 28, the theme of the ABAC meet is “Driving Growth Through Micro and Small Entrepreneurs in Trade, Services and Agriculture,” and is part of the advocacy of Joey Concepcion III, who chairs ABAC and is the Presidential Adviser for Entrepreneurship. The effort is also part of his Go Negosyo advocacy.

The ABAC meet aims to pursue genuine and inclusive growth and prosperity for the majority Asean citizens who still live within the poverty line and whose economic future will be challenged, especially with the realization of the Asean Economic Community (AEC).


Under the AEC, the trade of services, goods, commodities and investments will be encouraged and facilitated, but that should result to what I call “prosperity for all” and not for the established elites. I believe MSMEs will play a major role in pursuing genuine and inclusive growth and prosperity, not only in the Philippines, but also in the whole of Asean.

So I congratulate President Rodrigo Roa Duterte and Joey Concepcion for the overall hosting of the Asean Summit in Manila, and the ABAC meet.

While MSMEs make up 99.6 percent of the 900,914 business enterprises in the Philippines, based on 2015 Philippine Statistics Authority figures, less than 8,195 or below 1 percent are in the agriculture, forestry and fishing industries. So I believe there is still a need to emphasize the importance of establishing more MSMEs in the agriculture sector, especially if we will take into account that rural poverty is still very high in the Philippines.

Based on the research for InangLupa that I founded and head, the rural poverty incidence in the Philippines was 40 percent in 2014, while Vietnam’s was 18.6 percent in the same year. Thailand’s figure was 13.9 percent in 2013. So the Philippines has a lot of catching up to do in reducing rural poverty.

Looking at the bigger picture, there is a need for the country to adopt agri-industrialization as a strategy with MSMEs as one of the major driving forces.

Under that strategy, agriculture must be linked to manufacturing and international trade, and agro-industries must attain sustainability by achieving competitiveness in costs, prices, operational efficiencies, product offerings and other associated parameters.

Furthermore, there is a need to diversity Philippine agriculture by promoting more products, and shifting program priorities from mono-cropping to diversification and multiple cropping,

Eventually, less productive ricelands in the uplands and those relying largely on rain for irrigation will be planted to higher value vegetables, fruits, ornamentals and industrial tree crops like coffee, oil palm, rubber, cacao and hybrid coconuts. The productive rice lands will also be mechanized and available technologies to improve production should be made available to the farmers tilling such lands.

But production alone is not enough; value addition at the farm level stimulates greater farm production, bringing more income to agripreneurs. Value addition must also be guided by the inclusive market-oriented development (IMOD) framework that has four powerful principles: that resiliency nurtures sustainability; that markets motivate growth; that innovation accelerates growth; and that inclusiveness ensures that the poor benefit through their collective action.

Eventually, value-adding and agri-industrialization should lead to the creation of non-farm livelihoods so people in the rural areas will have complementary seasonal agricultural incomes, to supplement inadequate (or absent) agricultural incomes, and to take advantage of opportunities arising from the non-farm sector.

So agripreneurship in establishing more MSMEs is also the key to creating more wealth from the agriculture sector. But this needs a change or “retooling” of farmers and extension agents, because as it is now, a farmer is more concerned with cultivating land whereas a farm manager oversees farm operations. On the other hand, an agripreneur finds opportunities to make the most of agricultural output.

Joey Concepcion, as part of his Go Negosyo advocacy, has jumpstarted the Young Entrepreneur-Farmers of the Philippines (YEF Philippines) whose vision is to create “A food secure, resilient, and prosperous Philippines propelled by empowered young farmers-entrepreneurs.”

YEF Philippines’ mission is to mentor and empower young farmers to become successful entrepreneurs in high-value agriculture guided by the IMOD framework.

Also, Go Negosyo and the Department of Agriculture (DA) have sealed a partnership for the Kapatid Agri Mentor Me Program (KAMMP), which will apply the model of Kapatid Mentor Me, a 12-week coaching session for micro and small entrepreneurs, but aimed at creating agripreneurs. I congratulate Agriculture Secretary Manny Piñol for helping realize KAMMP, which will be undertaken by the DA-Agricultural Training Institute led by Director Luz Tapusok. I am also proud to be an adviser to KAMMP and YEF Philippines.

Agribusiness incubation (ABI) should be made part of mentoring agripreneurs. This can be achieved by improving the well being of farmers and the youth through the creation of competitive agribusiness enterprises by technology development and commercialization.

ABI aims to foster the innovation through creation and development of agribusinesses to benefit the farming community, and to facilitate agro-technology commercialization by promoting and supporting agribusiness ventures.

In the Asean region, important policy measures should also be undertaken to foster MSME development for the farming, forestry and fishery industries: Enhance harmonization of standards such as Biosafety, Good Agricultural Practices, Sanitary and Phytosanitary Standards (SPS), and HACCP compliance; develop exporters’ capability to conform to SPS and Non-Tariff Barriers (NTBs); attract public and private investment for the creation of institutional mechanisms to support exporters; and reduce discrepancies in national food control systems among individual Asean member-states.

There is actually a lot to discuss on developing MSMEs for the agriculture sector, and the good news is the “Prosperity for All-Agri Summit 2017” will be held on October 4, which will bring together experts in agriculture and entrepreneurship to discuss strategies to attain a “Prosperous Philippine Agriculture.” I will be taking part in the summit.

For the Prosperity Summit for All on April 28, I will take part in Session 1 titled “Creating an Enabling Environment in Achieving Prosperity for All.”
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When I headed the International Crops Research Institute for the Semi-Arid Tropics for 15 years from 1999, one of the strategies I put into place was to create partnerships to affect dramatic change in the lives of smallholder farmers. And I am happy that it is also partnerships that are behind the prosperity summits on April 28 and October 4. So I say “Mabuhay” to the people and entities behind the staging of the two prosperity summits!

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1 Comment

  1. Kevin Redd Rivera on

    I am a business management student on my way to third year. Now, the direction of what kind of business I want is in the agricultural sector. I had read your article “Smart and green cities” because I was fascinated with agritourism which led me to start researching about urban agriculture and ending up in one of your articles. I wanted to learn more about agriculture, you mentioned about “KAAMP” and I found out mentees will only be coming from farmers’ coop. I know there are a lot more where I can learn from about agriculture. I really want to make urban agriculture take its root, there’s so much opportunities in the lands of cities. I have to surround myself with people who have the same purpose that I want to execute. I was wondering if there would be an opportunity for me to participate in a movement concerning agriculture or urban agriculture. Or could you please give some advice on where I can start. Thank you for taking your time reading this. :)