Kristine L. Alave
Philippine Daily Inquirer
February 11, 2011
MANILA, Philippines—The Department of Agriculture (DA) has suspended the Agricultural Competitiveness Enhancement Fund (ACEF) after an audit showed it missed its target beneficiaries—poor farmers and fishermen.
Agriculture Secretary Proceso Alcala said the DA stopped the lending program—which allows small farmers and fisher folk to take out loans without collateral—on Jan. 31 and was currently reviewing it.
Sen. Francis Pangilinan, chair of the Senate committee on agriculture and food, warned the fund could go bankrupt.
He said that, based on a report submitted by the DA, only P5 billion remained of the ACEF fund which in 2009 contained P20 billion.
Pangilinan said the DA report showed that only P200 million in loan repayments since 2002 had been accounted for.
He said that about P900 million that was supposed to be released to farmers and fishermen was unliquidated.
“Releasing loans with zero interest and zero collateral attracts unscrupulous groups and individuals,” Pangilinan said in a press briefing at the National Agriculture and Fisheries Summit at the Eugenio Lopez Center in Antipolo City Thursday.
It was not explained where the rest of the money went but DA officials said this was part of their investigation.
Pangilinan said some of the borrowers did not belong to the “poorest of the poor” sector, noting that their profiles would have qualified them for loans from commercial banks.
“At the rate we are going, it won’t be long until the ACEF coffers go empty. We cannot give our farmers and fisher folk what we don’t have. Clearly, a restructuring of the ACEF policies is needed,” he said.
Meanwhile, Alcala said the DA has written to farmers who took out loans with the ACEF to pay their debts. Alcala said some of the borrowers had contacted them asking to restructure their loans.
The ACEF, which was created by law in 1996, is funded with duties collected from the importation of agricultural products under the minimum access volume (MAV) mechanism.
Aside from extending a credit line to farmers, the funds are set aside to build irrigation systems, farm-to-market roads, and post-harvest equipment and facilities.
The fund was supposed to expire in 2007, but it was extended to 2007 and then 2015.
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