AGRICULTURE AND FISHERIES MODERNIZATION ACT OF 1997

Republic Act No. 8435

Summary of the Agriculture and Fisheries Modernization Act of 1997

Declaration of Policy and Objectives (Sections 2-3)
- Promote equitable distribution of opportunities, income, and wealth.
- Achieve sustained increase in goods and services produced for the benefit of the people.
- Promote industrialization and full employment based on sound agricultural development and agrarian reform.
- Enable participation and sharing of benefits by those in agriculture and fisheries sectors.
- Promote food security, especially in staple foods like rice and white corn.
- Adopt market-oriented policies while recognizing contribution of agriculture and fisheries.
- Empower the agriculture and fisheries sectors for development and sustainability.

Strategic Agricultural and Fisheries Development Zones (SAFDZs) (Sections 5-12)
- Identify SAFDZs within the Network of Protected Areas for Agricultural and Agro-Industrial Development.
- SAFDZs to serve as centers for sustainable agriculture and fisheries development. (Section 6)
- Designate model farms within SAFDZs for economic-scale production. (Section 7)
- Map the Network of Areas for Agricultural and Agro-Industrial Development. (Section 8)
- Delineate SAFDZs within one year, with restrictions on land conversion for 5 years. (Section 9)
- Prepare land use and zoning ordinances incorporating SAFDZs within one year. (Section 10)
- Penalties for agricultural inactivity, premature conversion, and illegal conversion of lands. (Section 11)
- Protect watersheds that are sources of water for irrigable areas. (Section 12)

Agriculture and Fisheries Modernization Plan (AFMP) (Sections 13-19)
- Formulate and implement a medium- and long-term AFMP focusing on food security, poverty alleviation, income enhancement, global competitiveness, and sustainability. (Section 13)
- Formulate plans addressing food security, poverty alleviation, social equity, and income enhancement. (Section 14)
- Formulate plans aimed at enhancing global competitiveness and sustainability. (Section 15)
- Consider the effect of global climate change in formulating production programs. (Section 16)
- Consider special concerns like WTO challenges, agrarian reform, SAFDZs, infrastructure, credit, research and extension, biodiversity, environmental threats, rural non-farm employment, access to aquatic resources, and basic needs programs. (Section 17)
- Develop a Program Benefit Monitoring and Evaluation System (PBMES) and secure independent evaluators. (Section 18)
- Coordinate with other government agencies in implementing the AFMP. (Section 19)

Credit (Sections 20-25)
- Promote access to credit for small farmers, fisherfolk, and SMEs in agriculture and fisheries. (Section 20)
- Phase out Directed Credit Programs (DCPs) and establish the Agro-Industry Modernization Credit and Financing Program (AMCFP) within 4 years. (Section 21)
- Coverage of the AMCFP includes production, equipment, inputs, processing, storage, transportation, and other support facilities. (Section 23)
- Review mandates of LBP, PCIC, GFSME, Quedancor, and ACPC to improve credit access. (Section 24)
- Rationalize and consolidate credit guarantee schemes into an Agriculture and Fisheries Credit Guarantee Fund managed by Quedancor. (Section 25)

Irrigation (Sections 26-37)
- Promote rational use of natural resources, rehabilitation of existing irrigation systems, and development of effective, affordable, and efficient irrigation systems. (Section 26)
- Prioritize irrigation research and development. (Section 27)
- Select appropriate irrigation development scheme based on criteria like technical feasibility, cost-effectiveness, affordability, sustainability, efficiency, and productivity. (Section 28)
- Simplify public bidding for irrigation projects. (Section 29)
- NIA to continue planning, developing, rehabilitating, and maintaining National Irrigation Systems (NIS). (Section 30)
- Devolve planning, design, and management of Communal Irrigation Systems (CIS) to LGUs within 5 years. (Section 31)
- Promote private sector-led development of minor irrigation schemes like Shallow Tube Wells and Low-Lift Pumps. (Section 32)
- Encourage other irrigation construction schemes like Build-Operate-Transfer. (Section 33)
- Provide national government guarantee for Build-Operate-Transfer irrigation projects. (Section 34)
- Review and recommend reasonable Irrigation Service Fees (ISF) rates within 6 months. (Section 35)
- Monitor and evaluate irrigation programs and projects, with independent evaluators. (Section 36)
- Exempt repair, maintenance, rehabilitation, and BOT irrigation projects from election ban on public works. (Section 37)

Information and Marketing Support Services (Sections 38-45)
- Empower farmers and fisherfolk through timely, accurate, and responsive business information and efficient trading services. (Section 38)
- Establish a National Marketing Assistance Program to ensure highest possible income for farmers and fisherfolk. (Section 40)
- Set up a National Information Network (NIN) linking offices, research institutions, and end-users within one year. (Section 41)
- NIN to provide information and marketing services related to agriculture and fisheries. (Section 42)
- Provide technical assistance in setting up the NIN at the local level. (Section 43)
- Coordinate with government agencies for the NIN and allow private sector access with guidelines and fees. (Sections 44-45)

Other Infrastructure (Sections 46-59)
- Coordinate with relevant agencies for infrastructure requirements. (Section 46)
- Prioritize infrastructure investments based on agro-industrial potential, socio-economic contributions, lack of public investments, and presence of small farmers and fisherfolk. (Section 47)
- Give preference to cost-effective infrastructure facilities benefiting most producers and processors. (Section 48)
- Facilitate purchase and use of private infrastructure facilities. (Section 49)
- Coordinate with DPWH for public works priorities affecting agriculture and fisheries. (Section 50)
- Coordinate with DOTC, PPA, and PFDA for priority fishports, seaports, airports, and post-harvest facilities. (Section 51)
- Identify priority locations for farm-to-market roads with LGUs and farmers/fisherfolk. (Section 52)
- Coordinate with DOE, DPWH, NEA, and NAPOCOR for appropriate rural energy sources. (Section 53)
- Facilitate installation of telecommunication facilities in priority areas. (Section 54)
- Coordinate with DPWH and LGUs for water supply systems for agro-industrial uses. (Section 55)
- Prioritize funding for research infrastructure like farm laboratories and demonstration farms. (Section 56)
- Coordinate with BPRE and PHTRC for appropriate post-harvest facilities and technology. (Section 57)
- Encourage LGUs to turn over management of public markets and abattoirs to market vendors' cooperatives. (Section 58)
- Prioritize development and promotion of appropriate agricultural machinery and mechanization technologies. (Section 59)

Products Standardization and Consumer Safety (Sections 60-64)
- Adhere to and implement product standards to ensure consumer safety and promote competitiveness. (Section 60)
- Establish the Bureau of Agriculture and Fisheries Product Standards (BAFPS) within 6 months. (Section 61)
- BAFPS to set and implement standards for fresh, primary, and secondary processed agricultural and fishery products. (Section 62)
- BAFPS to formulate and enforce standards on quality, processing, preservation, packaging, labeling, import, export, distribution, and advertising. (Section 63)
- BAFPS may coordinate with experts and advisers, including DTI, FNRI, and BFAD. (Section 64)

Human Resource Development (Sections 65-79)
- Prioritize education and training on science and technology for social progress and human development. (Section 65)
- Establish a National Agriculture and Fisheries Education System (NAFES) to modernize and rationalize agriculture and fisheries education. (Section 66)
- Establish an Agriculture and Fisheries Education Program for elementary and secondary levels. (Section 67)
- Establish a Post-Secondary Education Program for Agriculture and Fisheries under NAFES. (Section 68)
- Establish a Network of National Centers of Excellence for Tertiary Education in agriculture and fisheries. (Section 69)
- Formulate a Rationalization Plan for non-accredited colleges and universities. (Section 70)
- LGUs to provide at least 10% of MOOE budget for provincial institutes within 2 years. (Section 71)
- Formulate a National Integrated Human Resource Development Plan in Agriculture and Fisheries. (Section 72)
- Formulate Output-Oriented Performance Standards for institutional evaluation. (Section 73)
- Establish a baseline information using Output-Oriented Performance Standards and conduct third-party evaluation every 5 years. (Section 74)
- Create an Agriculture and Fisheries Board in the Professional Regulation Commission. (Section 75)
- Formulate a National and Integrated Continuing Agriculture and Fisheries Education Program. (Section 76)
- Develop a national scholarship program for advanced degrees in agriculture and fisheries. (Section 77)
- Institute an output-oriented unified system of promotion for academic personnel. (Section 78)
- Budgetary allocation scheme for NAFES. (Section 79)

Research and Development (Sections 80-85)
- Enhance, support, and consolidate the National Research and Development System in Agriculture and Fisheries within 6 months. (Section 81)
- Research and development activities to be multidisciplinary, involving farmers, fisherfolk, and those in food and non-food production and processing. (Section 82)
- Funding guidelines: multi-year budgets as R&D grants, at least 1% of GVA by 2001, 20% for basic research, 80% for applied research and technology transfer, and a science fund. (Section 83)
- Formulate national guidelines for evaluating research and development activities and institutions. (Section 84)
- Communicate research results and technology through the National Information Network (NIN). (Section 85)

Extension Services (Sections 86-95)
- Prioritize utilization of research results through formal and non-formal education, extension, and training services. (Section 86)
- Extension services to cover training, advisory, demonstration, and information and communication support. (Section 87)
- Extension services to be multidisciplinary, involving farmers, fisherfolk, and those in food and non-food production and processing. (Section 88)
- Formulate a National Extension System for Agriculture and Fisheries (NESAF) composed of national government, LGU, and private sector subsystems. (Section 89)
- LGUs responsible for delivering direct agriculture and fisheries extension services. (Section 90)
- Encourage participation of private sector in training and complementary extension services. (Section 91)
- Government agencies to assist LGUs in improving effectiveness and efficiency of extension system. (Section 92)
- Funding for extension activities through multi-year budgets, extension grants to LGUs, and at least 1% of GVA by 2001. (Section 93)
- Formulate guidelines for evaluating extension activities and institutions. (Section 94)
- Develop an integrated multimedia support for national and LGU extension programs. (Section 95)

Rural Non-Farm Employment (Sections 96-107)
- Promote full employment and formulate policies and programs for efficient rural employment. (Section 96)
- Objectives: promote basic needs approach, make rural workers adaptable, promote rural industrialization and agro-processing, and increase income. (Section 97)
- Formulate the Basic Needs Program to create employment and cushion the effect of liberalization. (Section 98)
- LGUs to bear costs of promoting and monitoring the Basic Needs Program. (Section 99)
- Rural industrialization and industry dispersal programs based on market forces, with BOI prioritizing incentives for agriculture-linked industries. (Section 100)
- Government agencies to provide integrated services and information to prospective enterprises under one-stop-shop concept. (Section 101)
- Participating enterprises may request training, technical, and advisory services free of cost. (Section 102)
- Financing for facilities to be undertaken and financed by the private sector, except for basic infrastructure. (Section 103)
- TESDA to organize local committees for training scope, nature, and duration. (Section 104)
- DA and DENR to organize training in coastal resources management and sustainable fishing techniques. (Section 105)
- TLRC to undertake field training in entrepreneurship and management for Basic Needs Program workers. (Section 106)
- Implement special training projects for women's absorption in Basic Needs and rural industrialization programs. (Section 107)

Trade and Fiscal Incentives (Sections 108-110)
- Taxation policies must not deter growth of value-adding activities in rural areas. (Section 108)
- Enterprises engaged in agriculture and fisheries exempted from tariff and duties for importing inputs, equipment, and machinery for 5 years. (Section 109)
- Penalties for circumventing the import exemption provisions, including imprisonment, fines, and confiscation. (Section 110)

General Provisions (Sections 111-120)
- Initial appropriation of ₱20 billion for the first year, with specific allocations for various components. (Section 111)
- Continuing appropriation of at least ₱17 billion annually for the next 6 years, with additional funding sources specified. (Section 112)
- Implementing rules and regulations to be promulgated within 90 working days. (Section 113)
- Creation of a Congressional Oversight Committee on Agricultural and Fisheries Modernization. (Section 114)
- Powers and functions of the Congressional Oversight Committee. (Section 115)
- Periodic reports to be submitted by the Congressional Oversight Committee. (Section 116)
- Automatic review of policies and programs every 5 years by an independent review panel. (Section 117)
- Repealing clause for inconsistent laws, decrees, executive issuances, rules, and regulations. (Section 118)
- Separability clause. (Section 119)
- Effectivity clause. (Section 120)