On January 31, the House of Representatives approved on the third and final reading the Agrarian and Agricultural Loan Restructuring and Condonation Act. The bill seeks to enable condonation towards unpaid loans, surcharges, and penalties on loans of farmers, fisherfolk, and agrarian reform beneficiaries if they have made three consecutive payments on their restructured loans. As a result, farmers, fisherfolks, and agrarian reform beneficiaries can be reintegrated to the financial and banking system, allowing them to avail of other credit facilities. According to the bill, the condonation program will cover agricultural and agrarian reform loans obtained under the Department of Agrarian Reform, Department of Agriculture, People’s Credit and Finance Corp, Cooperative Development Authority (CDA), National Food Authority, and Quedan and Rural Credit Guarantee Corp. Conditions for condonation involve instances of market aberrations, where unusual changes in market prices have posed detrimental impacts to the income and yield of farmers, fisherfolk, and agrarian reform beneficiaries.
Many lawmakers have commended the passing of the bill, noting that it will alleviate the financial burden on farmers and hence, increase agricultural productivity. Such a measure would be instrumental to the success of the administration’s food security program. The bill is also expected to pass in the Senate without any major opposition, given the urgency to provide immediate support for overburdened farmers and fisherfolk. Agriculture, forestry, and fishing contributed 8.9% of the Philippines’ total GDP in 2022, lower than the 9.6% in 2021. The agricultural sector is expected to help drive the country’s economic recovery in 2023.
