The Philippines and Indonesia are expected to report the largest improvement in food security in the whole Asean region over the next decade, according to the latest outlook from the Food and Agricultural Organization (FAO).
The FAO, which published its agricultural outlook for the year 2018 to 2027 on Wednesday, said both countries were seen to benefit the most from the region’s continuing market integration. This meant a reduction in the countries’ undernourished population by 5 percent.
“The 5 percent fall in undernourishment accounts for both the benefits from price falls in some countries and costs from price rises in others,” the report said.
The integration of regional rice markets, specifically, was seen to help mitigate weather risks. The Philippines’ and Indonesia’s increased access to rice imports “could offset the food insecurity impact of a regional El Niño or of domestic crop failure.”
These two factors, according to FAO, were the largest risks to food security for both countries.
Based on the study, the shift to larger import volumes would depress domestic prices of rice in Indonesia and Philippines, which are projected to decline by as much as 39 percent and 45 percent, respectively, over the decade—the highest across the region.
Nonetheless, it noted that both countries’ domestic consumption would continue to be provided locally. Indonesia and Philippines’ reliance on domestic rice output is seen to decrease to 89 percent and 73 percent, respectively, from the current levels of 99 percent and 86 percent, respectively.
The organization said “this highlights that in both countries, regional integration and a vibrant and internationally competitive rice sector can indeed coexist.”
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