SEMANA, August 1, 2020
(Translated by Eunice Gibson, CSN Volunteer Translator)
Agricultural production is one of the strategic sectors that will move the economy forward and close the enormous inequality between country and city. The pandemic has proved its importance, vitality, and resilience. These are its commitments.
Perhaps no sector in the country brings together so many problems and, at the same time, offers so many opportunities for economic redemption, as does agriculture. Colombia’s countryside is where the better part of the problems that gave rise to the longest armed conflict on the continent originated. But in times of pandemic, agriculture has demonstrated its capacity to guarantee millions of jobs, and the endurance to keep on bringing food to the tables of consumers in Colombia and also, to keep on furnishing foreign countries with the products that are Colombia’s best ambassadors to the rest of the world.
And not for nothing. Because of its enormous potential and its strength, the agricultural sector is one of the four commitments for the reactivation of the economy, as announced by President Iván Duque in his speech on July 20.
Last year, agricultural exports were valued at USD 7,362,000, and in the first quarter of 2020, that increased by 6.8%, with increases in three consecutive quarters. Besides that, agriculture acted as a retaining wall so that the country’s GDP remained positive at 1.1% at the beginning of the year, in spite of the reduction in many productive activities.
During the last twenty years, the value added to the GDP by agriculture, cattle raising, hunting, forestry, and fishing, increased by nearly 30.4 billion pesos (a little over USD 8 million). That equaled an increase of 73.8% in the wealth yielded by that sector in two decades. The participation of agriculture in the GDP fell from 8.27% in 2000 to 6.74% last year, in spite of the fact that the value it added went from 41.2 billion pesos (a little over USD 11 million) to 71.6 billion pesos (a little over USD 19 million) in that period. That’s because other activities increased precipitously, which changed the composition of the economy.
On top of that, in the midst of the pandemic, agriculture gave an example of how to maintain extremely low levels of contagion. It did that while it was harvesting abundant crops of coffee, sugar, fruits and vegetables, flowers, bananas, potatoes, and rice, and it guaranteed supplies in cattle, poultry, and hogs.
But rural development has been marked by a number of complicated stigmas. First, the appearance of the armed conflict—half a century ago—after the emergence of campesino movements that complained about the unequal rural property model, concentrated in so few hands. The fight for the land ignited the most festering violence in the subcontinent for several decades.
It didn’t take long for another kind of armed action to emerge in the countryside. That was the introduction of drug trafficking, which used the land to plant illicit crops and produce illegal drugs. That provoked another bloodbath and the displacement of millions of campesinos, which continues to hamper Colombians.
The Peace Agreements in Havana in 2016 tried to finalize decades of conflict over the use and ownership of land, recognizing the need to vindicate the rights of the campesinos. There the government sealed its commitment to move toward a new countryside through a complete rural reform, as proclaimed in the first point of the agreement, and advance toward a structural transformation. It would promote the appropriate use of the land and stimulate formalization, restitution, and equitable distribution. That objective is unresolved.
Other problems also affect rural development. The perception that a small holding is less productive than a large estate, an exploitative and plundering model, has contributed to the generation of all kinds of battles, including ideological battles, and that has hindered advancement.
In moments of crisis like the present, the resilience and pragmatism of rural workers and business owners in responding to the challenges of supplying the country and foreign markets is surprising. This ought to call for a profound reflection on how to remove the barriers and guarantee conditions so that the sector can be changed into the great locomotive of reactivation.
The evils of the countryside
The great performance that the agricultural sector has achieved in recent quarters should not let us lose sight of the fundamental problems. The President of the Colombian Agriculturist Society (SAC), Jorge Enrique Bedoya, summarizes them as follows: 1) the inflexibility of the labor force, which generates a high level of informality and intensified inequality; 2) the embryonic infrastructure of tertiary roads and public assets, which aggravates the lag; 3) the scarcity and cost of credit, which impedes development in rural businesses; and 4) the lack of legal security of land ownership, which provokes uncertainty and prevents investment.
The subject of farm labor is a huge unfinished task. It’s estimated that, of the 5.3 million rural workers, nearly 86 % work informally, which means they have no access to social security benefits. In their final days they have no pension and live in poverty.
This occurs because our labor laws were designed for the cities, so they don’t reflect the reality of the countryside. The rural workers do their work on various schedules, by day, or by the week, and that can include different patterns. Activities like harvesting, for example, are seasonal, and the rigidity of the laws precludes formal hiring.
Some have suggested initiatives to solve these problems; however that has set off fierce political controversies that have kept them from being adopted. Bedoya says that “the first thing we need as a country is to formalize labor and have an agricultural contract, or an integrated rural work schedule or hourly work to guarantee social security.”
Even the so-called minimum social protection floor incorporated in the Development Plan approved last year, set off tough arguments. This would create a system of protection for part-time workers who can’t list the number of years or amount of wages required for eligibility for the pension funds. The extra income would be a big help for them.
The President of Fenavi (Poultry Growers National Federation), Gonzalo Moreno, believes that this subject can’t wait, because social security should not just be an urban privilege.
Investments yet to be made
In his speech on July 20, President Duque announced his reactivation plan Commitment to Colombia’s Future. It includes among its four points the work to be done in the countryside, and peace with legality.
The plan contemplates, among other actions, continuing the agricultural work by contract program, advancing the multipurpose land registry, and the projects of the Programs for Development with a Territorial Focus (PDET) so that more campesinos can become entrepreneurs, and assuring them public assets and facilitating access and financing. With regard to the last item, there is already a bill in the Congress that would furnish relief to small and medium producers in the countryside.
The provision of public assets is perhaps one of the areas that could really accelerate the reactivation of the country and, with it, agricultural development.
There are a number of urgent decisions to be made: improve roads to get to the countryside, make telecommunications into a bridge that encourages development throughout the country, invest in irrigation systems that would facilitate competition, and improve health and education services in rural areas so that families can live in conditions of well-being. Because, as says Roberto Vélez, General Manager of the Coffee Growers Federation, “We have to give the countryside opportunities so that the people stay and build the country.”
One of the principal outcries is for the construction of tertiary roads. Area in the country used for agriculture totals 40 million hectares, but fewer than 8 million are in production. There are 175,000 kilometers of highway, although only 10 per cent are in good condition. Because of that, the President of SAC insists on the urgency of tertiary roads for their double effect: they connect the far reaches of Colombia and they create employment. Every million pesos (about USD 268,000) invested in these roads would construct 5 kilometers of road in strip road pavement, and provide 290 jobs; 90 of those would be direct, said Bedoya.
The Minister of Agriculture, Rodolfo Zea, admits that the lack of paved roads raises the price of delivering products from distant areas. Together with the Minister of Transportation, he is working to build that program with 1.5 billion pesos (a little over USD 400,000) already budgeted.
The initiative, however, has to go through a prior discussion process with mayors and governors, because it will have to be prioritized with the limited resources available. But it has to be accelerated. “We are in the dry season and we have to get these projects needed to get the products from farm to town (vereda), from town to district (corregimiento) and then to the urban center,” said the Minister.
In the midst of the pandemic, there are enormous necessities that have to stay afloat within the government’s fiscal limitations. Nevertheless, Juan Camilo Restrepo, former Agriculture Minister, considers this subject set in stone. Building tertiary roads is expensive, but it’s worth it because these public assets will permit agriculture to escape the stage of pre-modernity, which is where it is now.
Rural inhabitants don’t just need roads. They also need information highways to be trained and to receive technical agricultural assistance by digital media. The better connectivity will give them access to education and better health by means of telemedicine.
In the last decade, this country modernized transportation infrastructure by giant steps with the impetus of concessions. But that didn’t happen with the construction of tertiary roads that connect the towns (veredas) and rural areas with each other, and improve living and working conditions for the people that live in the countryside.
Other key public assets are irrigation districts and harvest collection centers. The President of Fedearroz (National Rice Growers Federation), Rafael Hernández, says that well managed water supplies push productivity and allow growers to break with the seasonality of rice crops. And he complains that there has been no progress in this for more than 30 years.
There is concern in the rice sector because investments in irrigation districts have been sources of boondoggles in the past. Today the country has a million hectares irrigated, but it would require annual investments of a billion pesos (about USD 268,000) to double that capacity. The districts are key because the harvests are concentrated in places with an irregular pattern of rainfall. And frequently, when there is a district, it’s used inefficiently, because instead of plantings, there are cattle being pastured.
Where will the money come from?
The lack of access to credit hinders agricultural development. It produces, for example, the absence of security for the farmers who, if they don’t have title to their farms, find it difficult to get loans from financial entities. There are also other factors, such as the high risk of some crops because of climate.
The government has created instruments to overcome these obstacles, like crop insurance or sale of futures, but the small farmer doesn’t always have access to those. To maintain liquidity in agriculture in the midst of the pandemic, the government allocated 1.5 trillion pesos (USD 400,000,000) for credit. According to the Minister, it has paid out more than 623 billion pesos (nearly USD 166,000,000). Of that amount, 220 billion pesos (nearly USD 59,000,000) went to small producers and 194,000 million pesos (nearly USD 52,000,000) to middle-sized farms. But the worst affected by the lack of credit are the very small farmers, who have no credit history, or if they do, it’s negative. Because of that, the government needs to look for new instruments to facilitate access to financing.
To achieve that, it will have to re-think access to credit for agriculture, says Jeffrey Fajardo, President of PorkColombia. He insists that many producers are facing conditions that sometimes are very burdensome.
The land mess
The first point in the Havana Agreements made clear the government’s commitment to provide 3 million hectares for restoration of land to the campesinos affected by the violence, within 15 years. Besides that, it guaranteed legalization of 7 million hectares. The process, however, is going very slowly.
As of now, it has turned over nearly 15,000 ownership titles, out of the 80,000 announced by the current administration. In restitution, the most recent figures show that 70,200 people have received some 380,000 hectares. Advancing on this front will be crucial: as these producers get their ownership titles, equity will improve and long term investments will accelerate and stimulate the economy.
In order for this process to advance it will be crucial to have regulations that modernize the sector and convert the management of land registries into a public service provided by the Agustín Codazzi Geographic Institute; to have decentralized land registries that function in the provincial capitals; to have land registry managers, that is, public entities that carry out this activity as part of their mission; and to have regional entities with associative plans, such as the National Land Agency.
To modernize the land registries will also be crucial. The initial goal was to update the information on 60% of the properties in the country by 2022 and 100% by 2025. But in the plan for reactivation of the economy after the pandemic, the government is contemplating accelerating those goals. That would be a fundamental step for advancing the country in having clarity about land ownership so as to promote investment. Only with legal security can the country redeem its countryside
Beyond those challenges, there has to be coordinated work between public and private sectors. But what’s really true is that the producers, in the midst of the pandemic, have shown exemplary performance.
GENERATION OF EMPLOYMENT IN AGRO-INDUSTRIAL SECTORS
Trade Association Jobs
Asbama (Banana Growers) 15,000
Asocolflores (Flower Exporters) 150,000
Asocaña (Sugar Cane Growers) 286,000
Asohofrucol (Fruit and Vegetable Growers) 745, 390
Asoleche (Milk Producers) 736,000
Augura (Banana Growers) 35,000
Fedecacao (Cacao Producers) 60,000
Fedepapa (Potato Growers) 360,000
Fedearroz (Rice Growers) 400,000*
Fedepalma (Oil Palm Growers) 180,000
Fedecafé (Coffee Growers) 730,000
Fedepanela (Unrefined Whole Grain Sugar Producers) 278,199
Fedeacua (Fish Farming) 51,308
Fenavi (Poultry Producers) 350,000
Procultivos (Sustainable Agriculture) 5,700
PorkColombia (Pork Producers) 140,000*
Procaña (Sugar Cane Growers) 286,000
*Direct and Indirect
Some have been able to challenge the paradigms imposed by the pandemic and come out victorious. One of them, the coffee sector, had two big goals in the confinement period: harvesting and merchandizing. Vélez explains how, thanks to the teamwork of agencies and producers, they achieved one of the most successful processes.
In the same way, poultry producers were able to meet the increasing need for eggs, which have turned out to be the protein most frequently consumed by Colombians affected by the decreases in their income. The same thing happened with the producers and processors of rice. Their sales increased.
Millions of rural workers and business owners, with their hard work, have made it possible for people to have food without any problems in the more than four months of isolation.
This implies that agricultural producers have done their jobs. Now the government, the Congress, and Colombian society need to do their jobs too. It’s a moral imperative to resolve the better part of the difficulties that confront agricultural producers, and it’s also a good way for the country to reactivate and make progress together.
The big ideological and political battles waged for years about the future of the agriculture sector should give way to pragmatic decisions that solve the fundamental problems. That’s the only way this country can achieve its long-sought development of the countryside.