PROJECT AGRI-CHAIN: Modernizing Philippine Agriculture

Revitalizing the Rural Economy

The rural economy, composed largely of the agriculture, fishery and forestry sectors, is vital to most ASEAN economies. It continues to provide livelihoods to a large segment of the population and an essential driver for growth and poverty alleviation. According to a study by the University of Asia and the Pacific, while Philippine agriculture contributes only 12 per cent to GDP, agribusiness amplifies that to 35 per cent, thereby effecting a multiplier value of about 2.9.

A shift from primary production to processing increases the multiplier value of the rural economy. This is so because the final value of processed goods is much higher than the price of primary agricultural products. Furthermore, the processing industry stimulates the establishment and growth of supporting supplier enterprises, generating a multiple-round of enterprise generation and job creation. The processing industry increases the capacity of the rural economy to create decent jobs, or jobs that provide decent wages & salaries, security of tenure, and social protection (e.g. disability benefits, old age pensions, maternity leave, skills enhancement training, etc).

There are also more rural villages and communities than urban city centers in most ASEAN countries. Rural villages and communities continue to serve as the backbone of ASEAN economies. Strengthening the country’s economic backbone will enhance the resilience and sustainability of the national economy. As the experience of developed economies show, leaving the rural economy to deteriorate and diminish in importance will undermine the national economy’s sustainability.

THE MULTI-FRUITS & VEGETABLES PROCESSING FACILITY: SALIENT FEATURES

1. Primarily focusing on 350MT per day input of de-husked coconuts, producing coconut non-dairy beverages, coffee creamer, coconut water, coconut cream and flour. Simultaneously, it will process fruit puree, 100% fruit juices, and pure vegetable soups – all with 12-18 month ambient shelf-life using the most advanced UFT© technology – and filled for consumers in exciting and innovative packaging.

2. Intercropping: The plant “de-risks” its dependence on 100% coconut and is therefore able to accept other plants that can be grown efficiently among the coconut trees; e.g. banana at mid-level and watermelon on the ground.

3. 100% Green Sustainable Solution for Sewage, Garbage and Waste Water treatment. The processing and Solids separator accepts waste slurries comprising water, solids and other liquids. It filters the solids and separates the solids from all the liquids. The solids are converted into synthetic gas - primarily hydrogen and used to produce electric power. The filtered water is used for the processing of fruits and vegetables.

4. Earth-Friendly Packaging. The facility’s consumer (asecptic) packages cut food waste by 10% and packaging waste by 80% compared to packages from similar factories (Tetra).

5. Farmers & Community households as Stakeholders: Through the local cooperative, individual farmers/community households will become stakeholders in the project and receive quarterly distributions.

6. Housing for the poorest and factory workers will be provided.

7. Mobile Medical Car, Dental and Eye care units will be established at no cost to the local farmers/community households.

8. Pay Off Trader Loans: A program will be undertaken to rid the farmers from their indenture of local traders

9. Total project costs: US$55M

10. Project IRR: 29.9%; All cash investment IRR 39.9%