Game changer gift
Credit to Author: Tempo Desk| Date: Thu, 27 Dec 2018 17:00:38 +0000
MERRY Christmas and a truly more prosperous New Year!!!
Christmas and New Year generally bring with them the message of joy, peace, love, and hope for better times. Considering the inflation spikes we have had in the last few months, the message becomes even more appealing.
Interestingly, Albay Rep. Joey Salceda and Sen. Richard Gordon have packaged a new legislation they both consider as a major “game changer” for accelerated inclusive growth. This is the Agricultural Free Patent Act which has already hurdled Congress’ bicameral conference committee and now awaits President Duterte’s signature.
The Agricultural Free Patent Reform Act consolidates Salceda’s HB 8078 and Gordon’s SB1454. It will lift major restrictions imposed by the operative 1936 Commonwealth Public Land Act which prohibits landowners to sell and mortgage the land within the first five years of their patent grant and gives original landowners the option to buy back the property within five years from the date of sale.
The restrictions may have been well meant, but they have made agricultural patents and newly purchased lands virtually unbankable since banks do not want to tinker with such assets. They cannot be used as collaterals for loans the new landowners need to develop their property into more productive assets.
The new law lifts such restrictions and empowers qualified landowners to use their land assets as loan collaterals to develop their lands as viable livelihood sources.
Salceda noted that the Philippines is basically agricultural but agriculture contributes a measly share to the country’s annual Gross Domestic Product because of the restrictions which limit poor farmers’ access to funds to modernize and hike farm productivity.
“Without access to capital, Filipino farmers will remain stagnant with little hope of crossing over to the other side of the poverty line,” Salceda pointed out.
This situation, he added, is reflected in the banks’ poor compliance with the Agri-Agra Reform Credit Act of 2009, with banks only allocating 1.05% of their loan portfolio for agrarian reform credit vs. the 10% required compliance and 12.83% allocation for agricultural credit.
The 1936 Public Land Act which remains operative virtually boxes about 2.5-3 million or nearly 25% of the country’s 12 million registered patents. Lifting the restrictions will unleash tremendous capital funds and empower new small farmer-landowners to become viable farmer entrepreneurs. The government will also benefit from increased lending activities and taxes.