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Geography, agriculture and the economy of the Philippines One of the world’s largest archipelago nations, the Philippines consists of more than 7,100 islands lying between the Pacific Ocean and the South China Sea. The country’s territory — a total surface area of 300,000 km2 — extends 1,800 km from north to south and 1,100 km from east to west. The archipelago is of volcanic origin, with some still-active volcanoes. Terrain ranges from flat and undulating to hilly and mountainous. About 40 per cent of the total surface area is arable. The climate is wet and tropical. The estimated population in 2004 was 83.0 million, with an annual growth rate of 1.8 per cent, down from 2.3 per cent in 2000. AgricultureAgriculture plays a major role in generating income and employment in rural areas of the Philippines. Although the sector is growing at an average rate of 3 to 5 per cent, production is not keeping pace with population growth. A large part of Philippine agriculture operates at subsistence level and is vulnerable to year-to-year weather changes. About six out of ten people in rural areas depend on agriculture for their livelihood. The average farm is 2.5 ha in size, and rice and coconut are the principal crops. On Mindanao, almost one third of the land is devoted to agriculture, and the island accounts for 40 per cent of the Philippines’ food requirements, contributing more than 30 per cent to the country’s food trade Economy The Philippine economy is growing at a respectable rate, with gross domestic product (GDP) increasing at an estimated rate of 6.1 per cent in 2004. Agriculture’s share of GDP in 2004 was an estimated 14.3 per cent. Economic growth was mainly the result of improved productivity of agriculture and services, both of which benefited from government programmes to modernize agriculture and to deregulate telecommunications, shipping and trade. Inflation, which has been high in the past, appeared to be well under control at the end of 2003, when it registered an average rate of 2.5 per cent a year. In 2004, the rate of inflation rose sharply to about 8 per cent but is expected to decline to about 5 per cent. The enterprise sector is highly developed, with about 800,000 registered enterprises. More than 90 per cent of them are microenterprises. The high rate of unemployment is a crucial issue in the formulation of a poverty reduction strategy. At mid-2004 the rate of unemployment was 14 per cent, compared to 12 per cent in mid-2003. The fiscal deficit is another issue. It amounts to 4 to 5 per cent of GDP and results in high interest rates that put credit out of reach of poor farmers. Source: IFAD |
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