Freedom Debt

Bananas are among the most profitable raw materials for agriculture in the Philippines.... But many of the peasants who cultivate them are sentenced to lifelong destitution and starvation on the basis of exploitation agreements with banana-exporting businesses. In 2017, a Oxfam 2017 poll found that six out of ten growers in two of the country's biggest areas - Compostela Valley and Davao Oriental Province in the Mindanao area - were fighting to support their family' diet.

As part of the Filipino government's country reforms program, growers such as the bandana producers should have taken full command of output and gain entry to the exporting CM. Without the committed funds or the assistance to make their lands profitable, however, they have not brought the desired benefit to them. Consequently, many have been obliged to resell their lands or, as is the case with many growers of bananas, to agree to contractual conditions with large firms which Oxfam considers to be seriously unfair.

Whilst the cannabis sector is flourishing and business profits are rising, growers are being forced further into debt and destitution. In the absence of appropriate measures by the governments and businesses buying their own produce, growers will still fight to sustain themselves, even if they try to keep the production sector alive.

Filipino cannabis production is on the rise - so why are peasants going bankrupt? Philippines is the second biggest exporting nation in the word and the only Asiatic nation among the four biggest exporting nations in the globe. The peak of 2.6 million tons of export in 2012 accounted for almost 94% of trade in bananas in Asia.

That same year, two third of the Philippines' exports of the bananas were sent to Japan, China and South Korea. Following in the wake of rices and coconuts, the third biggest foodstuff in the Philippines is planted in the form of coconuts and beans. Much of the major exporter, the cocavendish Banana, is cultivated on Mindanao estates in the South Philippines.

As part of the government's agricultural reforms program, large estates of farmland were dismantled and reallocated to the working agricultural community, known as "agricultural reforms beneficiaries" (ARBs). They were also emboldened to set up co-operatives to gain eligibility for State aid.

But as the Mindanao cooperative case points out, the aid pledged did not materialise - exposing growers to the grace of ruthless creditors and compelling them to reach uneven and unjust arrangements with businesses and exporting firms. It is not those who cultivate it who are responsible for the prosperity of the production sector.

Instead of increasing their income, the cannabis growers and especially the cannabis growers co-operatives on Mindanao have piled up their debt because they have been imprisoned in annoying auto sales agreements with exporting and commercial firms. Whereas the peasants had long dreamed of possessing their own lands, for many the realities were a nocturnal dream (see Box 1 below).

When they noticed that many peasants were involved in repressive business deals, the OFC felt upset. By uncovering the weaknesses of growers in relation to the AVA contractual conditions - which were practically imposed by the purchaser undertakings - the survey showed how the provisions of these arrangements put growers at a competitive disadvantage. At the same time, the Commission also examined the extent to which the AVA contractual conditions were not in line with the AVA contractual conditions. They also showed how corporate policies have allowed them to maximise their profit while at the same time maintaining growers in an eternal state of unsurmountable debt and impoverishment.

Treaties show a clear distortion in favor of purchasers. The description of the farmers' commitments is in strong terms, while the rules in which the purchasers are involved are loose, allowing different legislative interpretation, usually in favor of the purchaser. Contractual instruments of fiscal controls make growers totally reliant on purchasers, who have almost complete sovereignty over the cooperative's fiscal soundness.

This includes a clause which allows the purchaser to fix a fixed banana prices irrespective of the cost of producing the product and the real interest rate on the markets; a clause which allows indefinite increase in the cost of producing the product without the consent of the farmer; and a clause restricting ownership of the product which prevents the farmer from growing other crop for extra revenue.

Treaties do not provide an efficient means of remedying abuse. An agreement gives the purchaser enough authority to bankrupt the farmers' co-operative. Governments have neglected to efficiently manage GSPs and enable growers to bargain from a strong negotiating stance. Department of Agrarian Reform has neglected to safeguard the interests of those who have made such arrangements.

The Commission has also neglected to give legislative and technological assistance to these producers, most of whom do not have the means to ensure the provision of legally protected service which protects their prerogatives and enables them to obtain more equitable contract conditions. Whilst the department published several directives on the regulation of AVS, the predominance of gross unilateral agreements strongly indicates that these regulations are not enforced.

Concerning the Oxfam/IDEALS survey, farmers' co-operatives were unable to negotiate complicated agreements because they did not have information on the different legislation and policy areas. They were unaware of their prerogatives and were not told of the possible negative consequences of concluding agreements with them.

In 2013, according to the surveyed farmer, they relied on the "good faith" of the business representative with whom they had built a good relationship. Farmer were also attracted by the so-called "signing bonuses" of $200-300 - two to three fold their month's earnings - pledged by businesses.

While agricultural co-operatives are perhaps the best known alternate trading models to ensure that value is distributed along the value chains and negotiating powers grow, they need recourse to finance and other assistance to be successful. Government institutions - which are designed to allow the farmer to increase productivity through low-interest credit - have in fact been strongly favoured by merchants.

Suppressive treaties are poor for all peasants, but female peasants - who have no vote in treaty negotiation - seem to bear a proportionate share of the costs of their outcomes. Oxfam conducted a 2017 poll of 185 female workers in Compostela Valley, which revealed that still widespread standards of living that maintain sex aspirations and the sex -specific distribution of labor continue to exist.

While men are regarded as head of households and decision-makers, females are required to lead and supervise the households and to assume most of the responsibility for them. For so little cash that comes in, struggling females are paying for essential and other needs such as health and schooling. Few opportunities exist for a woman to make an honest living or otherwise take on a different part outside the home.

Oxfam's experiences have shown that co-operatives can offer invaluable possibilities for the strengthening of women's economies and that pure peasant groups or co-operatives are an important means of increasing the proportion of female in the value of the diet. In the case of the farmers' associations, however, it was hard for a woman to make a meaningful commitment - not least because the association confined itself to those persons mentioned in the agreements, the overwhelming majority of whom were men.

Females are hardly ever asked about credit, loan and terms of payments - even if they divide any debts. Legal adherence has demanded an increased number of members of co-operatives, thus opening the way for the inclusion of females and the generation of incomes. In spite of marginalisation, participation in co-operatives has at least allowed females to build stronger ties with other females in the fellowship.

Witnesses in Box 2 (below) clearly show that due to the absence of representativeness within co-operatives, there is very little scope for negotiation and decision-making by a woman to facilitate her work. As a result of the investigation, a bill was drafted to govern agricultural inspection arrangements on agricultural land which has not yet been discussed by the competent commissions.

As of June 2016, the Federal Administration adopted an official order, "Rules on Agribusiness Venture Agreements", to fill gaps in earlier provisions on automated agribusiness venture agreements (AVAs). In July 2017, however, the US administration postponed the appointment, pending further verification and consultations, after hearing of many other annoying GPAs that have led to small farmer and tribal losses of lands in Mindanao.

DFC-BGARC, as already mentioned, has a strong feeling of female support and interest in women's humanity. The Oxfam hope to continue to build on this dynamism and is working with farmers' members to enhance cooperation and improve possibilities for empowering mothers. However, for the time being there is no favourable climate that would allow farmers to cultivate their areas in a productive way, either as small farmers or as members of a co-operative.