牛津经济研究院-菲律宾农业食品部门的经济影响（英）-2021-30页_2mb

AGRI-FOOD SECTOR IN THE PHILIPPINES: SUMMARY

Core Content

The agri-food sector in the Philippines plays a vital role in the national economy, contributing significantly to GDP, employment, and tax revenues. It is a resilient sector that has supported millions of jobs and ensured food security during the pandemic.

Main Points

Economic Impact in 2019

• The agri-food sector contributed USD 126.7 billion to the Philippines' GDP, accounting for 29.8% of the total GDP.
• It supported 18.0 million jobs, which is 42.7% of the national employment total.
• The sector generated USD 17.1 billion in tax revenues in 2019.
• The agri-food sector has grown consistently over the years, with a 16% increase in real GDP contribution from 2015 to 2019.

Sector Composition

• Agricultural production contributed USD 33.7 billion directly to GDP, and USD 45.1 billion when indirect and induced impacts are considered.
• F&B manufacturing was the largest component, contributing USD 58.7 billion to GDP, representing 46% of the total agri-food GDP contribution.
• F&B distribution contributed USD 22.9 billion to GDP, with 3.43 million jobs supported and USD 2.5 billion in tax revenues.

Trade in Agri-Food Products

• The Philippines has a trade deficit in agri-food products, with USD 12.7 billion in imports versus USD 6.5 billion in exports in 2019.
• Processed food and beverage products are the main contributors to the deficit, with processed cereals being the largest category.
• The net trade deficit widened from USD -2.7 billion in 2015 to USD -6.2 billion in 2019, reflecting a deteriorating trade balance.

Impact of the Pandemic (2020)

• The agri-food sector experienced a 4% contraction in GDP contribution in 2020, amounting to a USD 5.4 billion reduction from 2019 levels.
• This contraction led to a loss of 390,000 jobs and a USD 679 million decline in tax revenues.
• Despite this, the sector was more resilient than the overall economy, which was projected to contract by 9% in real terms.

Key Components of Impact

• Direct impact: The value added by the sector itself.
• Indirect impact: Economic activity generated by supply chain procurement.
• Induced impact: Consumer spending from wages earned in the sector and its supply chain.

Fiscal Policy Risks

• Fiscal risks are a concern for the agri-food sector, particularly due to potential cuts in agricultural subsidies.
• These cuts could have a disproportionate impact on small businesses, local industry, and low-income households.
• Excise taxes on sugar, salt, and plastics may be used to address health and environmental concerns, but they risk undermining the recovery of the agri-food sector if not well-designed and communicated.

Outlook for the Sector

• The outlook for the agri-food sector in Southeast Asia is mixed, with slow recovery expected due to the impact of the tourism industry.
• The Economic Recovery Matrix highlights the need for policy support and investment to address long-term challenges such as increasing demand for better-quality food and productivity improvements.
• Technological advancements and skill development will be essential to meet these growing demands.

Summary of Key Figures

• Total GDP contribution (2019): USD 126.7 billion
• Total employment (2019): 18.0 million
• Agricultural production: USD 33.7 billion (direct), USD 45.1 billion (total)
• F&B manufacturing: USD 58.7 billion (total)
• F&B distribution: USD 22.9 billion (total)
• Tax revenue (2019): USD 17.1 billion
• Pandemic impact (2020): 4% GDP contraction, USD 5.4 billion loss, 390,000 job loss

Conclusion

The agri-food sector remains a critical component of the Philippine economy, providing employment, food security, and tax revenue. While it showed resilience during the pandemic, it faces challenges in recovery due to fiscal policy risks and the slow revival of tourism. Strategic investments and policy support are essential to ensure the sector continues to drive economic growth and sustain employment in the long term.