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Friday, December 8, 2023

World Bank report: Climate change to disrupt PHL farm sector

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CLIMATE change is expected to wreak havoc on the country’s farm sector, raising prices of commodities such as rice and corn and causing millions to go hungry, according to the World Bank.

Based on the Country Climate and Development Report, climate change could increase corn prices by 12 percent; rice and corn milling, 7 percent; and palay at 7 percent by 2050.

With the high prices caused by a decrease in production, the World Bank said 17.4 million Filipinos could go hungry in 2030 and 17.11 million by 2050. This is 8 percent higher than the 16.11 million estimate in 2030 and 12.8 percent from the 15.16 million in 2050.

“The Philippines is projected to experience diverse impacts from climate change, including rising temperatures, rising sea levels, saltwater intrusion, and increasing variability in annual rainfall. These will impact crop farming, negatively affecting food security and nutrition,” the World Bank said.

“Large declines in yield and production are expected for corn and other crops. Typhoons, climate shocks, and disasters also pose localized risks that can diminish crop production,” it added.

Based on the climate projection for the Philippines, the country’s mean temperature, under a moderate emission scenario, could be 1 to 2 degrees higher by 2065 and up to 2.5 degrees Celsius higher by 2099.

Under a high-emission scenario, the World Bank said the country’s mean temperature could rise by 2 degrees Celsius earlier or even before 2065.

Further, the mean temperature is expected to exceed 4 degrees Celsius by 2099.

Lower yields, higher prices

THIS is expected to lead to lower crop yields for various commodities such as rainfed rice which is projected to decline 4.5 percent; rainfed maize, 21.6 percent; rainfed sugarcane, 4.7 percent; irrigated sugarcane, 4.3 percent; and banana, 3.7 percent.

“Substantial price increases are foreseen across the board, with the biggest jumps impacting corn, rice, and fruits and vegetables. The greatest decline in per-capita consumption relative to the baseline is projected for food corn, followed by rice, sugar, and fruits and vegetables,” the report stated.

With lower yields and higher prices, consumption for these commodities are expected to decline. Corn consumption will decline 3.2 percent in 2030 and 5.6 percent in 2050; while rice consumption will decline by 2.2 percent in 2030 and 2.9 percent in 2050.

The data also showed consumption for fruits and vegetables will decline by 1.2 percent in 2030 and 2.3 percent in 2050; pulses, 0.2 percent in 2030 and 0.4 percent in 2050; roots and tubers, 0.5 percent in 2030 and 0.9 percent in 2050; and sugarcane, 1.3 percent in 2030 and 2.4 percent in 2050.

Lower growth, wages

THE World Bank said this all will lead to lower agriculture growth and even lower agricultural wages. Real agriculture gross value added could decline 1.95 percent by 2050; government savings, 13.41 percent; and agricultural wages, 2.94 percent.

“By 2050, with adaptation, the agricultural GVA will be 10 percent higher, while agricultural wages may decline by 4 percent. Government savings will also decline by 3 percent, despite larger outlays for government consumption and a shift into increased capital formation for irrigation development,” the report stated.

Given these risks, the World Bank recommended that support be provided to both adaptation and mitigation. This will lead to a “triple win” in terms of increasing productivity and profitability for producers regardless of the impact of climate change.

The World Bank also recommended that government provide direct financial subsidies “when appropriate and necessary” in order to help with mitigation and adaptation efforts.

Barriers to action

THE report also cited a need to lower or eliminate barriers that prevent the private sector from taking climate-smart action.

These barriers  include inadequate information about climate change impacts and solutions, poorly functioning mechanisms to disseminate information to producers.

The list also includes weak implementation capacity at all levels, inadequate coordination when collective action by producers is required, and imperfect access to the right financial instruments. “The private sector will drive these climate-smart changes through its own decisions and investments, yet government policies will have to play a critical role in promoting and supporting them,” the report stated.

“A key first step is ensuring that existing government policies, regulations, and investments do not undercut private-sector incentives for necessary changes,” it added.

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