February 1, 2011
THE AGRICULTURAL Competitiveness Enhancement Fund (ACEF) is facing bankruptcy and borrowers must settle their outstanding debts, said Senator Francis N. Pangilinan in a statement yesterday.
“I am aware that ACEF was created to provide support to the agricultural sector, but releasing loans with zero interest and zero collateral attracts unscrupulous groups and individuals,” said Mr. Pangilinan in his statement.
Mr. Pangilinan, who chairs the committee on agriculture and food, called on Department of Agriculture officials to suspend the release of ACEF until the agency is able to restructure its policies to meet the demands of its beneficiaries without going bankrupt.
“Unless we are able to address the loopholes, the most prudent thing to do is suspend the release of funds,” said Mr. Pangilinan.
Enacted in 1996, ACEF is a special fund created under Republic Act 8178 out of the proceeds of the in-quota tariff rate for the maximum access volume (MAV) of importation.
In-quota tariff is the preferential rate given to products whose volume of shipment fall within the ceiling of agricultural imports, called MAV.
It was assigned Special Account 183 and was intended to provide interest-free and collateral-free loans in support of projects that would enhance the agricultural sector.
In a report submitted to Mr. Pangilinan, ACEF documents show that it has a fund balance of only P1.8 billion.
The same report shows that of the P20-billion total amount the agency has raised since 1999, only P200 million was accounted for as collected payment for loans since 2002.
“At the rate we are going, it won’t be long until the ACEF coffers go empty… Clearly, a restructuring of the ACEF policies is needed,” said Mr. Pangilinan.
Mr. Pangilinan and leaders of both governmental and private agricultural agencies and organizations are going to have a summit on Feb. 10-11 to address various issues hounding the agricultural sector.
ACEF was initially set to expire in 2005 but was extended by Congress to 2015. — JPDP