ON Friday, Oct. 7, 2022, I will be delivering a presentation virtually in the 2022 Yushan Forum hosted by Taiwan. Specifically, I was invited to discuss the recovery of the agriculture sector in the Association of Southeast Asian Nations (Asean) and New Southbound Policy (NSP) countries, and how it links to Taiwan.
So, here is an overview of what I will discuss.
Leveling up Philippine agriculture cannot be done by Filipinos alone, and regional cooperation should be fostered to secure the food needs of consumers, and raw material needs of certain industries.
I am not saying, however, that the Philippines rely largely on imports for its food needs, especially with today’s geopolitical crisis.
Rather, the Philippines should further push cooperation and partnerships with its regional partners including those outside Asean like Taiwan.
Taiwan is currently pushing the NSP with the 10 member countries of Asean, six states in South Asia, Australia and New Zealand. Meanwhile, the Asean is pushing the ACRA, or the Asean Comprehensive Recovery Framework. The aim of NSP, from what I have observed, is to level up Taiwan’s relations with the Asean and South Asian countries, including Australia and New Zealand.
So, what does Taiwan bring to the table when it comes to the development of the agriculture sector of the Asean member countries including the Philippines?
Taiwan’s advantage in agriculture
For one, Taiwan has already attained a high self-sufficiency in rice, or 110 percent, which is laudable as it devotes only 22 percent of its land to agriculture.
Taiwan is also among the countries in Asia where efforts to apply artificial intelligence (AI) in agriculture are happening at a fast pace. An article published in smartcitiesdive.com titled “Agricultural Transformation: Taiwan combines HI and AI to double farmers’ income” showed that to increase domestic dragon fruit production, Taiwan’s Industrial Development Bureau of the Ministry of Economic Affairs has partnered with private communications company U-Sync Internet Service Co. to establish a smart demo field with Dragon Digital Farm Co., the country’s largest dragon fruit farm, located in Pingtung. That area accounts for about 25 percent of Taiwan’s area devoted to dragon fruit cultivation.
“The digital twin model developed by U-Sync can help farmers who wish to transform their farms by growing dragon fruit in winter and do not want to spend 5-10 years to figure out how to. With this model, the company can quickly obtain winter-production technology, and it is estimated that each hectare of farm can increase the income up to NT$600,000 ($21,945.9),” the article stated.
The article added that the AI-based dragon fruit system is being applied in Indonesia and Malaysia, and will be scaled up. I will not be surprised if years from now, more Asean and South Asia nations will seek Taiwan expertise in applying AI in their agriculture sectors.
In Taiwan, the convergence of AI and the Internet of Things is also happening, and is called AIoT, or the Artificial Intelligence of Things.
Taiwan is also not dependent on milk exports like the Philippines. In 2021, that country’s local production of milk was estimated at 437,000 metric tons (MT) while imports was only 72,000 MT. Taiwan’s milk production system is one of the more advanced in the world and employs robotics.
The case of Asean
Asean has been considered one of the primary growth areas in the world, and much of its potential for wealth creation can come from agriculture. The economies of the regional bloc are the fifth largest in the world and more can be achieved with regional integration and the full realization of ACRA.
The region’s agriculture sector can also be developed for niche markets, but this needs to be supported by a reduction of trade barriers. Development of Asean’s infrastructure — ranging from seaports to highways — will also facilitate more trade among the bloc’s member countries.
In the Philippines, Mindanao is well-positioned to cash in by supplying agri-based raw materials as it has the perfect agro-economic condition ideal for a wide range of crops, including staples like rice and corn. Meanwhile, Brunei, Indonesia and Malaysia are best suited for industrial crops like rubber, tobacco and soybeans.
At present, Asean has a self-sufficiency rate (SSR) for the following major crops: rice, 117.9 percent; corn, 73.8 percent; sugar, 89.7 percent; soybean, 8.6 percent; and cassava 167.4 percent.
Clearly, there is a lot of work to do for the region to reach 100-percent SSR in crops like corn and sugar, and most especially soybean.
To make the Asean agriculture sector more competitive, the following challenges should be addressed: Changing demand for technologies and machine services; changing demographics with more women joining agriculture while more farmers are getting old; changing environment typified by extreme weather conditions causing floods and drought; and destruction of mangroves and forests to host aquaculture and farms, respectively.
Those set of challenges can be addressed by resource management by leveling up and utilizing sustainable green technologies; minimizing pre- and post-harvest losses and waste along the agriculture value chain; leveling up trade facilities to attain economic integration and market access; increasing resilience to climate change, natural disasters and similar shocks; ensuring food security and safety as well as equitable food distribution so the poorer segments of society do not suffer from hunger; assisting small and medium enterprises to become regionally and globally competitive, and able to access more profitable markets; and undertaking concerted and joint approach to regional and international challenges to attain regional economic cooperation, and leverage science and innovation to attain an inclusive digital economy.
For the Philippine setting, the following solutions can level up the agriculture sector: consolidation and farm clustering; increasing investment that also should be market-oriented to ensure sustainability; ramping up research and development; adopting mechanization; improving rural infrastructure including farm-to-market roads and irrigation facilities; prioritizing support for public goods.
The numerous challenges the agriculture sector of Asean and the Philippines face means that there is still so much room to increase crop and food production, and go into value-adding. This, in turn, will lead to more wealth creation, especially in the countryside, resulting in poverty reduction.
For its part, Taiwan is slowly becoming a hotbed for the development of agricultural technologies, including those from the digital sphere. The framework for increased cooperation with Taiwan to level up Asean and Philippine agriculture can also be developed and provided by the NSP and ACRA.
So, what are we waiting for?
Lastly, we welcome to the countryside the leaders, officers and members of Fil-Am Chamber of Commerce Manila with their energetic Secretary-General Jonathan Nollero!