PHILIPPINE PLANNING .a·c·,· JOURNAL XXVIII, No. 2... · comprises the provinces of Cavite,...

PHILIPPINE PLANNING! .a·c·,· JOURNAL~ <)~."zCJ)

~ SCHOOL OF URBAN AND REGIONAL PLANNING • Vol. XXVIII, No.2, April 1997 •

PHILIPPINE PLANNING JOURNALVol. XXVIII, No.2, April 1997

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TABLE OF CONTENTS

1 A STUDY ON THE UNCHECKED CONVERSIONOF AGRICULTURAL LANDS INTO NONAGRICULTURAL USES: THE CALABARZONEXPERIENCE

Ma. Haezel M. Barber

.21 LAND USE CONVERSION AND THEDEVELOPMENT PROSPECTS OF MALOLOS,BULACAN

Sem H. Cordial, Genice L. Bodeta,Gladstone A. Cuarteros, Joey S. Sena,Edgar L. Dona, Mario Libiran, Merci L.Angeles

41 THE PROBLEMS AND PROSPECTS OFINDUSTRIAL GROWTH: A CASE STUDY OF THELUISITA INDUSTRIAL PARK

Emmanuel M. Luna, Santiago R. Aquino,Jr., Aurelia R. Bathan, Angelina M. Noble,Oresentacion A. Ordas, Edgar F.Zotomayor

A STUDY ON THE UNCHECKED CONVERSION OFAGRICULTURAL LANDS INTO NON-AGRICULTURAL USES:

THE CALABARZON EXPERIENCE

Ma. Haezel M. Barber

I. INTRODUCTION

A. Background

The recent trend towards globalcompetitiveness and industrialization haseffected an upsurge of manufacturing activityin the country. A shift in macro-economicpolicy pronouncements has been made tospur this industrialization trend. The passageof Republic Act 7916, otherwise known as theSpecial Economic Zone Act of 1995, affirmsthe government's response to this trendthrough the establishment of regional agriindustrial centers (RAICs), regional industrialcenters (RICs) and special economic zones(SEZs). A large number of establishmentshave, in fact been started, and of these, asignificant number is found in the provinceslocated near Metro Manila. These provincesare Cavite, Laguna, Batangas, Rizal andQuezon (CALABARZON). Large-scale,export-oriented and foreign-financedindustries have been set-up resulting in theconversion of vast tracks of agricultural landsinto industrial sites. These have become veryattractive to investors as well as migrants,partly because of the limited opportunities forinvestment and employment in the NationalCapital Region (NCR), and partly because ofthe resources that are available in theseareas.

Since the Philippines is an agriculturalcountry, eenversion of agricultural land is theinevitable response to the pressure exertedby industrial development and urbanexpansion. The growth in urban populationhas resulted in an increase in demand forhousing and urban services. Industrial,residential, and commercial uses thuscompete with agriculture for scarce land.

There is, therefore, a need to promotethe judicious use of land and other physicalresources based on the principles ofsustainable development.

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B. Statement of the Problem

The CALABARZON subregion isproclaimed as an industrial estate regardlessof its agricultural potential. Local officials andlandowners took this as a go-signal forconversion. Productive agricultural lands havebeen tagged as future industrial sites by virtueof policies for industrial estates developmentand, hence, out of the ComprehensiveAgrarian Reform Program coverage. As far asagricultural lands being converted toresidential uses is concerned, recent studiesma''':" by the Housing and 'and UseRegulatory Board (HLURB) showed that out ofthe 7% or 500 hectares of irrigated agriculturalland taken up by subdivisions, approximately68% is located in CALA8ARZON.

The conversion of agriculturai lands intosubdivisions in the subregion was intended toexpand and facilitate the access of land to asmany income groups as possible. Access toland would mean availability and theopportunity to put it into use, taking intoconsideration factors such as cost of theproperty, location, cost of transportation to andfrom the site, terms of acquisition, andapplicable development regulations.

While the results of the consultations withthe concerned local government officials andtheir constituents generated interest andenthusiasm in CALABARZON, it cannot bede'i"lit1(1 that certain issues - particularly thosepertaining to the social, economic, andenvironmental effects of unchecked conversion- warrant serious consideration. Given presentconversion practices in the field, there is nowthe genuine concern for the future capacity ofremaining agricultural land to meet the needsof national food self-sufficiency.

Based on the above scenario, the paper isan attempt to address the problemsconfronting conversion of agricultural landsinto non-agricultural purposes specially thoseconverted into residential uses.

PHILIPPINE PLANNING JOURNAL Vol. XXVIII,No.2; April 1997

C. Objectives of the Study

The intention of land use conversion inidentified economic zones is to accommodateincreasing industrial and economic activities,as well as assign or allocate residential sitesfor housing the increasing migrant and naturalpopulation. The latter, though, becomes morepressing than the allocation of sites forindustrial uses. Given the above discussions,the objectives of the paper are as follows:

1. to assess the existing laws, rules andregulations enacted which serve asbases for the conversion of agriculturallands into non-agricultural uses; and,

2. to determine the social, economic andenvironmental effects and implications ofunchecked conversion.

D. Limitations of the Study

The study focuses on discussions onconversion of agricultural lands intosubdivisions in CALABARZON. While theintention of this paper is to cover as wide ascope as possible, limited time was allottedfor the preparation of the study and logisticsupport was inadequate.

E. Methodology

In undertaking the study, secondary datain the form of published and unpublisheddocuments were sourced. Interviews with keypersons in authority were also conducted tosolicit their views on the subject matter.Reference was also made to various relatedmeetings and conferences to identify. otheremerging issues and current trends.

II. BACKGROUND STUDIES

This portion of the study presents anoverview of the CALABARZON project, itsexpected future role in the national economy,its poslt'on in spatial development, andavailability of resources. The basic principlesas well as legal mandates on land useconversion will also be discussed to provide aframe of reference in understanding theconversion process.

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A. CALABARZON Project Brief

The Project CALABARZON is a largescale, multi-sectoral complex planned in aregion contiguous to Metro Manila. The projectwas originally conceived by the Department ofTrade and Industry (DTI) to transform agrobased rural economies to industrial/urbanthrough high industrialization, led primarily byforeign-export-processing type enterprises. It isan ambitious regional development projectdesignated by the government as one of the 5special projects for financing under thePhilippine Assistance Program (PAP) of theMultilateral Assistance Initiative (MAl).

As a model case of regional developmentin the Philippines, different areas in theCALABARZON subregion will be transformedfor the benefit of the local people: from urbansquatter areas to quality housing sites havinggood access to high-grade social services andurban amenities; from crippled to fullyequipped urban centers; and, from povertystricken rural surroundings to a richenvironment containing industries surroundedby productive agricultural land and forestareas.

Project Area/Coverage. TheCALABARZON subregion occupies the centralpart of the Southern Tagalog region. Itcomprises the provinces of Cavite, Batangas,Laguna, Rizal, and Quezon (Figure 1). Thesubregion has a total land area of 16,229 sq.kms. corresponding to 35% of the land area ofRegion IV and 5.4% of the total national area.The population in the area as of 1991 isestimated at 6,349,000 accounting for 77% ofthe region's total and 10.5% of the nationalpopulation. The CALABARZON area is areceiving area for the spill-over population fromMetro Manila which accounts for this high rate.

Expected Future Roles ofCALABARZON. The CALABARZONsubregion is expected to play a range ofimportant roles in the future development ofRegion IV and the country as a whole.

Economically, it is expected to become adriving force of further industrialization in thecountry together with Metro Manila and otherareas in the National Industrial Core. Its shareof the gross domestic product is 11.7% whichis larger than its population and territorialshares. Horticulture (fruits) and a few industrialcrops (coffee, black pepper) have likewisecontributed relatively large shares in thenational production.

Figure 1

SOtltH£RN TAGALOG alGION MAP

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Unchecked Conversion of Agricultural Lands


Another expected role of the region,implied by its industrialization function, is toattract foreign and domestic investments andsubstantially contribute to export. In additionto political stability, the provision of a betternatural and human environment will be thegeneral expectation of prospective investors,supported not only by better physicalinfrastructure but also by capable people andan efficient social system. In terms ofinfrastructure, the SUbregion appears to be ina better position than the rest of the countryexcept for Metro Manila. Although with therapid urbanization and population growth,difficulties in providing these are beginning toarise.

As for spatial development, thesubregion is centrally located and forms partof mainland Luzon or the Growth CorridorSubregion. As mentioned earlier, this servesas a receiving area of spill-over from areas inMetro Manila and provides alternativelocations for industries.

The subregion is endowed with richnatural resources. Most of it is favorable forvarious agricultural activities. However, sincepart of the area is relief hills and mountains,these have to be denuded to accommodateincreasing economic activities.

Development Strategies. As a catalystfor the development of the entire region, thefollowing development strategies wereformulated:

1. Integrated Planning Strategy. This willfollow an integrated regionaldevelopment plan, coordinating theefforts of various implementing agenciesand reflecting the interests of the people,to effectively solve and alleviateproblems that go with sprawl andexpansion.

2. Agro-Based Strategy. This strategy willemphasize agriculture, agro-processingand the development of services directedto the rural population. It will call forincreasing agricultural outputs to supportprocessing industries and changing thecropping patterns to exploit the marketingopportunities in Metro Manila and thegrowing urban centers withinCALABARZON. It will also emphasizethe maximum utilization of indigenousassets such as tourism resources,minerals, and human resources.

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Utilization and processing of raw materialsto be used as supplies by other provincesmay expand the resource base for thisstrategy.

This strategy alone, however, cannotsupport the high growth expected for thesubregion. The shares of the agriculturesector in the CALABARZON economy andemployment are already small, and thesector can grow only at a relatively lowrate. With the conversion pressure onurbanization/industrialization inCALABARZON, substantial increase inagricultural land is not likely, and soanother strategy must be adopted.

3. High Industrialization Strategy. Thisscheme will make the most of the spillover from Metro Manila for the highindustrialization of CALABARZON. Thisinflux, however, will be directed to ideallocations in a more organized manner bydeliberate planning and location policies.

Anchor Project Components. TheCALABARZON Special Development Projecthas different sets of anchor components forwhich implementation will happen duringPhase I (1991-1995) and Phase II (19962000). These are categorized into six areas asfollows:

1. Port Development involves theexpansion and modernization of thefacilities of the Port of Batangas to serveas an alternate international seaport, andthe development of Sangley Point into atranshipment/container port.

2. Roads and Highways Development involves the construction andimprovement of the various major roadnetworks that will link Metro Manila toCALABARZON.

3. Industrial Development - encompassessites and services improvement of existingindustrial estates and export processingzones in Cavite and Laguna, andconstruction of new industrial centers andindustrial estates in Batangas and Rizal,respectively.

4. Power Generation and Transmission includes the construction/expansion ofthermal plants and power stations, and theimprovement of transmission anddistribution systems in the differentsubstations.

5. Telecommunications - requires theupgrading and increase oftelecommunication facilities in selectedcities/municipalities and identified sites ofindustrial estates in the area. This isbeing done through the NationalTelephone Program-Tranche 1-1 and thePLDT's X-5 Program.

6. Social Development - includes thecomprehensive packaging andimplementation of socia-civic programsand projects to contribute to the socialand human development in the area.

B. Basic Principles for Land UseConversion

Philippine Constitution

The guiding principle for stateintervention in land use conversion isembedded in the Philippine Constitution. Therelevant provisions in the Constitution give afoundation which specifically addresses theissue of industrialization based on soundagricultural development and agrarian reformwhile ensuring the optimal use of the nation'slimited land resources (Article XII, Section I).It advocates the equitable access to land.This provision is qualified by the declarationthat the use of property bears a socialfunction, implying maximum productivity forall lands (Article III, Sections 1, 15 and 16).The Constitution also requires theharmonization of national and localgovernment responsibilities in determining thedirection of land uses in their respectivejurisdictions consistent with the objective ofdecentralization (Article XII, Section 6). Thisis explicitly translated through the passage ofthe 1991 Local Government Code (RA 7160).

In the medium-term, both the nationaland local government units should reconcileland-use related activities. It is important thatconversion guidelines be made flexible andadaptable to respond to the dynamicconditions at the local level at the same timebe consistent with the national framework andapproach to development.

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Unchecked Conversion ofAgricultural Lands

• National Physical Framework Plan(NPFP)The document sets a policy agenda for

land use planning incorporating regional, localand sectoral policies. It recognizes the needfor a national policy and focuses on therational use of resources in a multi-sectoralapproach to decision-making. The goals andprinciples outlined in the plan are directedtowards:1. the pursuit of increased regional plan

cohesion and integration;2. guided spatial planning process for urban

development and provislon of services;and,

3. a concept of development that proceedsaccording to the efficient utilization of landand best use, promoting industrializationthrough sound agricultural practice andagrarian reform.The NPFP stresses the important role of

community-based planning which relies on theempowerment of groups (small farmers, tribalgroups, upland farmers, women's groups) whopresently have little power in society. Suchplanning would be mandated at both thenational and local levels.

• Medium-Term Philippine DevelopmentPlanThe document emphasizes the equality of

women and men in development and servesas a basis for raising the consciousness in theposition and needs of women as political andeconomic participants in society. Concern forthe role of women in the land conversionprocess centers on the likelihood of thembeing disadvantaged due to the traditionalsocial relations which give the man the soledecision-making power. Women should beempowered to negotiate for their own interestsby legitimate and meaningful partrclpation inthe various stages of a project and within thelocal level 9rganizations.

• Geographical Planning UnitThe implementation of a more

comprehensive program of land use planningrequires the definition of an effectivegeographical planning unit that will provide anappropriate focus.

• Environmental AssessmentIt is important that current environmental

procedures be improved to measure thepotential impacts and potential costs moreeffectively and thus serve as a critical tool inplanning and land use conversion decisions.


c. Legal Mandates

A summary of the laws, rules and regulations needed to implement and translate the aboveprinciples into an agenda of action is listed in the following table.

Table 1. LEGAL DOCUMENTS RELEVANT TO LAND USE CONVERSION

Leaal Documents DescriptionSection 20 of RA 7160, otherwise • provides the authority of reclassification of agriculturalknown as the 1991 Local lands to LGUs in accordance with prescribed limits,Government Code providing for the manner of their utilization or

disposition• confers upon the city or municipality the general

authority to reclassify lands consistent with the townplanning process, and reserves or maintains the landuse conversion authority to the DAR

Sections 4 and 5 of EO 129-A • gives to DAR the exclusive authority to disapprove orSection 65 of RA 6657, otherwise approve the conversion, restructuring or readjustmentknown as the Comprehensive of agricultural lands into non-agricultural usesAgrarian Reform Law

DAR AD 1,2, and 8 series of 1990 • provides rules and requlations to implement theDAR AD 5 series of 1992 provisions of RA 6657

• outlines the conditions where land use conversion maybe allowed

• provides the granting of a disturbance compensation todisplaced farmer beneficiaries affected by theconversion

DOJ Opinion 44 Series of 1990 • excludes coverage from RA 6657 a parcel of land whenit has been classified as commercial, industrial orresidential before the effectivity of the law on 15 June1988

• should be pursuant to the Land Use Plan or ZoningOrdinance of the City/Municipality as approved byHLURB.

DOJ Opinion 181 Series of 1990 • exclusion of declared areas of lands under the LungsodSilangan Town Reservation in the Province of Rizalfrom RA 6657 since these have been reserved astownsite purposes and not deemed agricultural landsas defined under the said law

RA 7279 otherwise known as the • provides for the formulation of an Urban DevelopmentUrban Development and Housing and housing ProgramAct • provides among others:

» utilization of residential lands in consideration ofthe needs and requirements of underprivileged andhomeless citizens and not merely on the basis ofmarket forces

» development of urban areas conducive tocommercial and industrial activities which cangenerate more economic opportunities for thepeople

» accessing land and housing by the underprivilegedand homeless citizens

III.

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III. ASSESSMENT OF EXISTINGSITUATION

A. Land Use Conversion Practices

The current practice of land useconversion in CALABARZON can generallybe described as being in accordance withthe rules and regulations prescribed byexisting laws.

lands gives them considerable power indecision-making. The town plans theyprepare are used as guides for land useconversion. However, if the plan wasapproved prior to June 1988, the allocationof land to non-agricUltural use in a town planis sufficient authority to convert without DARapproval. Thus, DAR has no control oversuch conversion and has, therefore, raisedquestions as to the validity of current townplans as bases for land use conversion.

Land Use

An assessment of the impacts of landuse conversion is effected through theissuance of an Environmental ComplianceCertificate. Land use planning andconversion are, thus, gUided by costsassociated with the destruction of theenvironment and the depletion of resources.

Land use in the region is predominantlyagricultural consisting of rice, sugarcane,pineapple, coconut and other crops.Vegetables are also common especially inthe areas close to Metro Manila. Mountainareas are covered with coconut plantationsand forests which are partly denuded. Table2 presents the general land use in thesubregion. A more detailed presentation ofthe different land uses for the five provincesis given in Annex A.

The following discussion will furtherpresent an assessment of the conversionpractices in the CALABARZON taking intoconsideration the different factors directlyrelated to land use conversion.

The seriousness of the threat ofconversion to agricultural land cannot beestimated from existing data as somestatistics indicate an increase in harvestfrom rainfed and irrigated land.

The authority granted to localgovernment units to reclassify agricultural

T bl 2 GENERAL LAND USE CALABARZON S b

Presently, there is no comprehensivedata for the amount of agricultural landactually converted to non-agricultural use.Data available are collated in variousregisters such as the DAR,. HlURB, theMayors Office, and Department of PublicWorks and Highways. Under presentpolicies, the authority to act on land useconversion applications covering five (5)hectares or less is delegated to the DARRegional Office while application for landsgreater that five (5) hectares are acted uponby the DAR Central Office. There are alsoconversions that go on without the approvalfrom DAR or any government agency as wellas cases when conversion has already beendone before filing the application forconversion. These situations explain theunreliable statistics on land use conversion.

a e , u reaion

land Use Cavite, laguna, Batangas, QuezonRizal

Area (ha.) % Area (ha.) %

Agricultural crops 411,434 54.7 455,610 52.3

coconut 173,182 (23.0) 385,932 (44.3)

sugarcane 92,667 (12.3) - (0.0)

Grass and Shrubland 192,065 25.5 68,858 7.9

Forest and Woodland 72,157 9.6 310,463 35.7

Built-Up Area 41,104 5.5 33,289 3.8

Total 752,223 100.0 870,660 100.0

Source: Master Plan for CALABARZON: Appendix

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Agricultural lands constitute about863,000 has. (53%) of the totalCALABARZON region. Of this area,grassland accounts for 268,000 has. (17%)while forest and woodland cover 280,000has. (18%). Some parts of the lowland areawhich are mainly paddy fields have beenconverted into built-up areas especially inRizal, Cavite, and Laguna. Agricultural landuse in the region seems reasonable ingeneral being in accordance with itstopographicand soil characteristics.

Fertility of the soil is generally high as itcontains organic wastes originating from theupland and carried by storm runoffs. Theregion, however, is susceptible to soilerosion. This condition is directly related toloss of top soil on cultivated lands, and in tumto siltation problems at the lower parts of theriver systems due to soil lost from theagricultural land.

It is worth mentioning the availability ofapproved land use plans as bases formanaging and guiding land resourcesproperly. Many of the existing plans wereprepared and approved in the early 1980swhen there was not much pressure ofindustrialization in the region. Updated andapproved land use plans are effective toolsthat will regulate future land uses and willcheck indiscriminateconversion of lands.

AgricultureThe following factors were considered

as constraints to agricultural development inthe region, namely: natural conditions;farming practices; poverty of farmers; supportservices by government; and, competitionwith other sectors.

Based on the survey on the socioeconomic situation of the agricultural sectorconducted by the Department of Agriculture,the poverty incidence of about 38% in theregion is rather low compared with 70% forthe whole Philippine rural area. Low incomewas nevertheless considered the most

common factor of dissatisfaction. This isfollowed by road access, health care,irrigation, water supply, and post-harvestfacilities. Dissatisfaction .in terms of theenvironment was raised mainly from themore developedprovinces or areas.

As considerable measures for improvingpresent liVing conditions have been effected,most of the people in the area expectgovemment subsidy on farm inputs andcredit and cooperative development.Infrastructure such as roads and irrigationfacilities is demanded in Quezon while manypeople in Batangas believe that employmentopportunities in factories can improve theirliVing conditions. Not many people regard thecurrent agrarian reform program as a way ofsolving dissatisfaction.

Land conversion to non-agriculturalpurposes was also given as one of the majorconstraints to agricultural development. Withthe expansion of Metro Manila, urbanizationand industrialization continue at the expenseof agricUltural land, especially the lowlandpaddy areas in Cavite, Laguna and Rizal.Although the provincial governments havetheir own land use plans, it is feared thatagricultural land will ultimately be convertedunless an effective law on land use isestablished. Land productivity is much higherin industry than in agriculture. Thus, farmersopt to sell their agricultural lots to investorswithout realizing their future prospects interms of employment opportunities andhousing provisions when industries orsubdivisionsare put up.

Table 3 clearly illustrates the rate bywhich agricultural lands are converted intonon-agricultural purposes for all the regions.It will be noted that even if Region IVregistered a decreasing rate of conversionover a four-year period and increasing at alow rate during 1995, it still ranks first in thecountry.

Table 3. AGRICULTURAL LANDS CONVERTED INTO NON-AGRICULTURAL PURPOSES(in hectares, as of December 1995)

Reaions 1991 1992 1993 1994 1995CAR 0.4106 13.6998 5.4421 2.0581 1.9180Region I 7.6085 14.1211 6.7187 29.1668 55.2734Region II 39.4408 6.8075 0.9103 79.5051 1.0718Region III 73.3496 246.2123 272.5225 882.4606 131.5967Region IV 2,883.6566 1,249.2114 470.3415 443.7146 748.1970Region V 10.3763 3.7215 28.7131 49.4279 159.0808Region VI 49.7300 412.9362 310.5879 304.0323 120.3474Region VII 0.8417 42.7278 36.2529 101.0303 -Region VIII 20.1314 29.1284 0.8719 9.3319 0.8420Region IX 26.8n7 9.0743 117.4387 30.6881 -Region X 56.0464 24.9295 99.0382 37.3554 611.0585Region XI 133.7669 128.5308 301.2400 1,203.5402 166.6715Region XII 18.4108 28.6694 8.9281 167.5114 17.1n6ARMM - - . - -

Total 3,320.6473 2209.7900 1,659.0059 3,339.8227 2,013.2347

Source. Centerfor LandUsePolicyandPlanomg Implementation (CLUPPI)Bureau of Agricultural Statistics

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Table 4. POPULATION IN CALABARZON SUBREGION

SOURCE: National Statistics OfficeCALABARZON Master Plan Appendix I: Social Development

Province Total Population Growth rate p.a. Population(%) Density in

1970 1980 1990 70-80 80-90 1990(per ha.)

Cavite 520,180 771,320 1,153,000 4.02 4.10 8.95Laguna 699,736 973,104 1,374,000 3.35 3.51 7.81Batanaas 926,308 1,174,201 1,476,000 2.40 2.31 4.66Rizal 307,238 555,533 973,000 6.10 5.76 7.43Quezon 902,865 1,129,277 1,373,000 2.26 1.97 1.58Ch.LABARZON 3,356,327 4,603,435 6,349,000 3.21 3.27 3.91Share of 75.32 75.24 76.86Population toRegion IVPopulation ..

the whole nation decreased in the sameperiod. Population is dense in Cavite with8.95 persons per hectare closely followedby Laguna with 7.81. Table 4 presents thepopulation per province with theircorresponding growth rate.

The expanding population inCALABARZON is primarily a result ofmigration. Based on surveys conductedby the National Statistics Office (NSO),the in-migration rate is about 6.2% whileout-migration is only 3.5%. Rizal andCavite have the most in-migration with13.2% and 8.4% respectively. The outmigration experienced by Rizal andQuezon indicate a case of rural-push-outmigration. Table 5 presents the migrationrates experienced in CALABARZON.

Social Development

The social sector is defined as thatwhich provides the basic social services tothe people and their community. Thisparticular sector is expected to contributedirectly to the improvement of life of thepeople as well as to ensuring thesustainable development of the economyby strengthening the human resources.

The population of the CALABARZONsubregion in 1990 was estimated to be6,349,000 accounting for 76.9% of thepopulation for Region IV. The annualgrowth rate of this area is increasing from3.21% during the 1970-1980 period to3.27% for the 1980-1990 period. Whilethe population growth in the area hasaccelerated in the 70s and 80s, thepopulation growth in Region IV as well as

Table 5. MIGRATIONRATES, CALABARZON SUBREGION

Province In-Migration Out-Migration Net-Migration

Total Rate*(%) Total Rate*(%)

Cavite 53,045 8.4 15,150 2.4 37,895

Laguna 43,638 5.4 21,369 2.7 22,269

Batangas 18,165 1.8 28,464 2.8 (10,299)

Rizal 54,795 13.2 26,493 6.4 28,302

Quezon 22.718 2.2 32,951 3.2 (10,233)

* Total in- or outmigration divided by 1975 populationSOURCE: National Statistics Office

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of private subdivision of lands, govemmentsponsored low-cost housing and site andservices prpgrams, and spontaneousdevelopment of residential areas in existingtowns. The establishment of smallmanufacturing enterprises as well as largescale industrieshas also taken place.

At present, within the 30 km radius fromManila, this trend is proceeding alongexisting major roads. The pressure of landdevelopment for housing and manufacturingfacilities will continue to be very high alongthe major transportation axes. The highestpotentials are areas with good accessibilityalong the South Superhighway, areas inRizal, and lowlandsin the Cavite area.

Housing

Based on the NSO's housing statistics,of the total number of housing units in theCALABARZON area. 97.22% are occupiedwith an average of 1.03 households perhousingunit. Most of the houses are made ofstrong materials and were built after 1960.While the results of the survey indicated thatmost owners have acquired their housingunits on their own, they greatly dependedonthe governmentto provide them with the siteto build the structures.

The government housing projects inCALABARZON are related to the housingproblems in Metro Manila where there isdifficulty in accessing decent housing units.This results in the proliferation of squattersand squatter syndicates, increasing thenumber of the homeless. urban deterioration,and in effect, inadequate, inefficient. andineffective delivery of basic services.Resettlement projects have beenimplemented for squatters in Metro Manila.Such projects are found in San Pedro,laguna and two areas near Dasmarinas.Cavite. However. none of these resettlementproject areas have successfully prOVidedsuffICient job opportunitiesto residents.

Table 6 presents the distribution of landuse conversion applications into residentialpurposes.

PHILIPPINE PLANNING JOURNAL Vol. XXVIIf,No.2; April 1997

The genera! pattern of distribution bymajor income source and class indicatedthatthe income levels of agricultural activities areconcentrated in relatively lower classes whilewages and salaries from non-agriculturalactivities apply to the medium and higherincomegroups.

With developments in CALABARZON,conflicts have arisen among its people andcommunities. Foremostof these are pollutionand environmental problems. dislocation ofsmall farmers and other affectedcommunitiesand specific groups to give wayto infrastructure projects. and rise in landprices. The latter has brought about anegative impact on tenant farmers due toincrease in lease rates. likewise. publicservices are also affected by such high landprices.

Urban and Spatial Development

The macro policy frameworkof industrialdispersal has been adopted as a nationaldevelopment strategy since the early 1960s.In the Philippines. this has been done withthe designation of regional industrial centers(later termed as regional agro-industrialcenters or RAICs) as focal points in industrialdispersal efforts. Among those identified byDTI as RAICs in Region IV are the CaviteExport ProcessingZone (EPZ) and BatangasCity.

The existing regional spatial structureindicates that most parts of CALABARZON,except peripheral areas of Batangas and theBondoc peninsula and the Polillio Islands inQuezon, are within the 100 km radius ofMetro Manila. This location characteristic ofCALABARZON has made it a special regionin the national spatial development. It isexpected that the area will become aproduction and service center to support thedevelopmentof the nationaleconomy.

Becauseof its proximityto Metro Manila,the developmentof CALABARZON has beeninfluenced by the growth of the metropolis insocio-economic and physical terms, mainlycaused by the over-spill of the population.This suburbanization trend has taken forms

Table 6. LAND USE CONVERSION APPLICATION INTO RESIDENTIAL PURPOSESProvince! Cityl UnderDOJ Under Approved Total Conversion %Municipality Opinion Process (has.) (has.) Application Increase

(R.O. & C.O.) ApprovedfromMar 1988

I~- Dec1990

97 65.~.2073 504.7917 112.30 29VITE 1.171.0141 127.1049 1.2312 2,049.3502 555.80 37

NA 1464.8146 631.7936 263.3609 2,359.9693 134.40 6ZON 43.9917 145.9271 157.1942 347.1130 '>1.60 17l 833.9426 31.7110 599.0152 1,464.6668 610.60 71

Total 3615.5627 1002.3215 2.108.0088 6,725.8930 1464.70 28

Source: Center for Land Use Policy and Planning Implementation (CLUPPI). DARNovember 17, 1995

10


Strategies to resolve expected housing RA 7279 has also listedproblems in the area as a result of the in- CALABARZON as one of the prioritymigration and over-spill population have areas for shelter development. As such,been outlined. For one, low-cost housing is it is integral in the provision of socializedan important component of the proposed housing and resettlement areas for theintegrated industrial/urban development immediate and future need of theprogram. The provision of housing for those underprivileged. Priority shall be given toto be displaced or affected by the on-site development. Table 7 gives theimplementation of Project CALABARZON is priority areas for implementation of thealso one of its essential components. Act in CALABARZON.

Table 7. PRIORITY AREAS FOR SHELTER DEVELOPMENT ANDIMPLEMENTATIONOF RA 7279 IN REGION IV

CALABARZON Area)Major Regional Growth Priority Urban Areas ForIsland Poles Implementation of RA 7279

Grouping City/Mun. Province City/Municipality

Luzon Lungsod Silangan Batangas Alitagtag San Jose

Batangas City· San Luis

Bauan San Pascual

Lemery Sta. Teresita

Lipa City Sto. Tomas

Mabini Taal

Malvar Talisay

Mataas na Kahoy Tanauan

Cavite Bacoor Mendez-Nunez

Carmona Naic

Dasmarinas Rosario"

Gen. Mariano SilangAlvarez Tagaytay City

Gen. Trias Tanza

Imus Ternate

Kawit Trece Martirez

Laguna Alaminos Pakil

Bay Pangil

Binan Pila

Cabuyao San Pablo City

Calamba San Pedro

Liliw Sta. Cruz

Los Banos Sta. Rosa

Paete Siniloan

Pagsanjan Victoria

Rizal Angono Cardona

Antipolo Morong

Baras San Mateo

Binangonan Taytay

Cainta Teresa'Reglonal Industnal CenterSource: Housing and Land Use Regulatory Board

11

PHILIPPINE PLANNING JOURNAL Vol. XXVIII, No.2, April 1997

B. Investigation of IssuesThe expansion of urban population and

consequently the demand for urban land hasrapidly taken place in the area. Studiesindicate CALABARZON as the most probablesite for resettling because of its proximity toMetro Manila and as such, has led toincreases in the demand for housing andother urban services. While the availability offlat land has been an essential to theestablishment of residential subdivisions, theproblem is that much of this land is eitherirrigated or irrigable.

The authority given to lGUs to reclassifylands to pursue their respective localdevelopment goals has contributed to landuse conversion. The measures adopted toachieve such development objectives rangefrom "allocation of adequate/suitable land forindustrial development" to promoting the"development of industrial estates in suitableareas and appropriate locations."

A comparative analysis of the studiesmade in 1992 and the inventory made byClUPPI of DAR in November 1995 (Table 8)have indicated an increase of 26.37%(59,860 has.) in land use conversionapplications. A percentage increase of about19.96% (15,495 has.) represents approvedland use conversion applications both at theCentral and Regional Offices.

The magnitude of land use conversionseems to be irrelevant at the national level.Figures in Table 8 represent landconversion applications which show that notall the regions are affected equally. But uponscrutiny of these regions, some provinceshave been more susceptible to land usethan others. Studies made in 1992 haveindicated that the CALABARZON areastands out as among those most vulnerableto conversion (Figure 2). Figure 3 presentsthe 12 critical municipalities, 75% of whichbelong to CALABARZON.

Table 8. SUMMARYOF STATUSOF LAND USE CONVERSIONAPPLICATIONSAs of 17 November 1995

Computations are based on the figures Indicated In the Report on land Use Conversion Practices,November 1992SOURCE: Center for land Use Policy and Planning Implementation (ClUPPI), Department of Agrarian

Reform (DAR)

Approved DOJ Opinion Under Process Total

Region No. Total % Inc.. No. Total % Inc" No. Total % No. Area in Ave.Area in Area in Area in Inc.· has. %

has. has. has. Inc.*Phils. 1,387 15,495.44 635 24,846.26 546 10,167.40 2,568 59,859.9125

CAR 23 40.43 32.00 2 14.45 151.40 4 16.67 47.89 29 45.57 100

I 39 124.69 1.38 2 144.50 10 296.35 2.07 51 585.34 1

II 156 166.38 26.45 8 26.65 5 101.13 44.00 169 154.43 25

III 168 2,288.87 21.53 48 1,718.88 7.23 79 2,549.61 18.88 295 5,987.36 12

IV 470 7,392.18 20.42 424 17,179.35 7.16 175 3,692.63 124.02 1,069 38,051.34 13

V 53 307.57 15.51 11 333.39 45 588.52 17.53 109 1,255.30 8

VI 85 1,392.97 13.49 43 837.16 31.84 97 1,582.97 7.22 225 3,257.28 19

VII 43 208.36 11.15 10 72.50 30 273.94 54.47 83 418.94 30

VIII 23 75.57 89.08 20 301.64 11 181.43 527.14 54 784.71 24

IX 20 240.86 11.58 5 37.64 8 50.45 1733.3 33 125.74 615

X 99 913.18 6.14 10 3,303.74 28 313.16 137 6,920.64

XI 155 2,042.96 5.67 45 783.88 49 382.80 114.81 249 1,950.56 12

XII 53 301.42 5.05 7 92.48 5 137.73 189.76 65 322.70 39

Average 19.96 15.20 221.63 26.37

*

12

I

...'•

•I,

fr ftEGlONVII

lJ:. •,., .• 1:::::;:;1\O'f!l,,0

13

Figure 2.

RECIONXIt

MINDJ.NAO


'Ptovincclt 'alOIIt,alticteilby :f..aDdl1ee Qrmniaa

1.~2. Cavne3. lliu1...~S.'~

,-::~

1. N......~j.8.a~

9.Loyte10. CebuU.,Aklan12. Nep.ll!'~13;Smuh'~14. CotaJ:wltoIS. Ltnm &el None

IECIQNXl

PHILIPPINE PLANNING JOURNAL Vol. XXVIII, No 2, April 1997

.T.

TIT" • • •

•••

Figure 3. Distribution of 'Critical- Munidpa)jties in Region rv

t. OavnaJ1n.as2. BacOOT3. General Trias4. CarmonaS. Nalc6. St..Rou

14

7. amn8." Catamba9. Cabuya-o1(1. Antlpolo11. Angono12. NuiJtbu

Data as of November 1995 have indicatedthat the following municipalities inCALABARZON have registered the highest landuse conversion from agricultural to residential,industrial, and commercial purposes: Nasugbu,Gen. Trias, Binan, Sta. Rosa, Silang,Binangonan, Antipolo, Calamba, Dasrnarinas,and Angono.

Although reports show that there is anapparent reduction in the coverageof agriculturallands in favor of residential areas, the data pointto a threat but do not indicate gravity of thesituation. The question of whether land useconversion is indeed a serious threat to the landreform program and to valuable agricultural landcannot be proven unless in-depth studies arecarried out in areas affected by land useconversion.

With reduction in agricultural land coverage,CARPable lands will also be reducedconsiderably. While the law says that farmerbeneficiaries (FBs) who may be adverselyaffected by the conversion may be relocated toother areas, and that DAR may identify possibleareas for redistribution, the truth is almost everyinch of arable/cultivable lands in the country isalready occupied and claimed. Those availableare marginal lands that are not economicallyfeasible and environmentally sound foragricultural use.

Conflicting government policies andpriorities have also significantly contributed toissues.of land use conversion. On one hand, thegovernment advocates industrialization toaddress the country's industrial needs in termsof employment generation, and goods andservices. The impression generated by thisaction is that industrialization is a biggereconomic factor than agriculture. On the otherhand, pursuant to the principles of theConstitution, the promotion of industrialization issaid to be based on sound agriculturaldevelopment and agrarian reform, thus priority inland utilization should be given to these.

The above situation points to a fact thatthere is a dichotomy between agriculture andindustry. But their relationship could besymbiotic. This is why there is an integratedagriculture and industry (agro-industrial)framework advocated to strengthen linkagesbetween the two. This should ensure that theoutput of agriculture will be used by industriesand vice versa.

In terms of food security, a more carefulanalysis would show that this issue does notseem to be a strong justification for land usecontrols. Food security is a broad concept. Forinstance, the import of some food items and

15


agricultural inputs, which to a certain degreeincreases domestic production of certain fooditems, may not have substantial impact onfood security, especially if agricultural land isnot reserved for the production of importantfood staples. In short, relative to otherincentives and disincentives affecting theagricultural sector, "protecting agricuaurallandfrom conversionmay have little impact on foodsecurity,"

Furthermore, the problem with restrictingthe use of land that is highly suitable foragriculture is that the same land may also behighly suitable for urban use. Preventing theconversion of certain plots of land simplybecause these are very fertile ignores thelogic of comparative advantage and couldresult in very inefficient allocationof land.

The proclamation of CALABARZON asan industrial zone has also created conflictssince agricultural and CARP-covered landsare located therein but are becoming targetsfor conversion to industrial, settlement andother non-agricultural uses. This may havealso been brought about by the absence of arational national land use policy that willprovide the framework for determining themost economically and socially efficient use ofavailable lands.

The potential benefits of economicdevelopment are envisioned to be equitablydistributed among the region's political units.However, the issue of shared influence andpolitical capital for the units' governing elite isa political question that has to be resolved.

The question is how far theCALABARZON environment can sustainpoverty at rates of greater increase. Theproject squarely concerns itself with the issue,an intimidating one since environmentalproblems can no longer be ignored nor evendownplayed. The real issue is not a trade-offbetween' economic development andenvironmental conservation but ratherenvironmental management for sustainedeconomicgrowth.

C. Effects and Implications

1. Environmental and Physical

a. Industry'S encroachment onagriculture's domain pushesdislocated communities to theuplands. Upland migration carrieswith it the problem of slash and burnfarming which results in soil erosion.The eroded material ends up inrivers, reservoirs, and irrigationcanals which reduce lowland

PHILIPPINE PLANNING JOURNAL Vol. XXV/ff, No.2, April 1997

agricultural productivity. Furthermore, denuded uplands are one ofthe main causes of devastatingfloods.

b. The change from agricultural,forested or rural land to highlyurbanized land causes dramaticchanges from the constructionphase to actual use of the land. Theprocess of urbanization directlyaffects soils in the followingways:

b.1 Soil may be scrapedoff and lost

b.2 Once sensitive soils aredisturbed, they may have lowerstrengths when they areremodeled.

b.3 Materials may be brought infrom outside areas to fill adepressionprior to construction,leading to a much different soiltype than was previously there.

bA Draining soils and pumpingthem to remove water maycause desiccation (drying out)and other changes in soilproperties.

b.5 Soil in urban areas issusceptibleto pollution resultingfrom deliberate or inadvertentaddition of chemicals to soils.This problem is serious ifhazardouschemicalshave beenapplied.

c. Environmental degradation caneffectively remove the main sourcesof livelihood for the vast majority ofthe people creating even greaterurban poverty. It is expected thatthe impact of environment changewill bring about major economic,social, political and institutionalchanges in the region.

Land conversion problemscannot be dissociated fromenvironmental policy concerns. Anydecision to convert agricultural landsinto urbanlindustrial uses will resultin the further diminution of thealready limited farmland, changingthe biophysical nature of the areawith its negativeeffect to the over-allenvironment.

16

2. Economic

Positive:

a. Increases per capita of the ruraland urban population throughaccelerated increase in industrialand agricultural productivity andemployment generation.

b. Induces a climate conducive forinvestors and producers toparticipate in the agro-basedindustrialization of the region.

c. Disperses industries, disperseseconomic opportunities, dispersespopulation.

d. Economic development haspositiveeffects on political stabilityand peace. As people becomeweaned away from poverty, socialtensions decline. Similarly,economic development is a precondition for improving the qualityof life in society as wealthincreasesand is dispersed acrossa wider sectionof the society. Theinstitutionalization of democracyhas a better chance underconditionsof economicprogress.

Negative:

a. The conversion of the remainingprime agricultural·lands will pose aproblemfor food production. Moreinputs will be required to sustainagricultural yield and inevitablemovementto the uplands for foodproduction will intensify. Further,as mentionedearlier, alterationstoland forms in the pursuit of layingthe foundation to urbanlindustrialgrowth will impair existingecosystems and may bring aboutmore environmental stress.

b. Land use conversion threatensfood self-sufficiency andenvironmental quality. Conversionof productive agricultural landsand marginal areas go on withseeming disregard for itsimplication on the sustainability ofeconomicgrowth.

3. Social

Positive:

a. Better housing, together withimproved health, sanitation andeducation, has a significant effect inincreasing labor productivity in thelong run. By increasing the capacityof the poor in terms of physical andmentalwork, their chancesof gettingjobs will be higher. The long termeffect is a tendency towards thedistribution of income amongregions, social classes and culturalgroups.

b. Promotes equitable developmentavoiding the rise of urban poor andsquatters.

c. Creates better human environmentand increases social capacity fordevelopment.

d. Existence of cheap labor whichserves as main attractionfor foreigninvestors.

e. The provision of housing impact onthe economicstabilityand well-beingof the family based on theassumption that poverty andeconomic insecurity are majorcausesof social problems and socialinstability.

Negative:

a. Increase in the number ofapplication for land use conversionand rapid increase of land pricestranslate into a potentialdisplacement of small farmers,tenants, fishermen and landlessworkers. Possessing minimal skills,they will be unable to find jobs thatwill provide enough income fordecent food, shelter and services.This can result in the proliferation ofsquatters and slums characterizedby a lack of securityof tenure to theirhouses. They suffer unhygienicconditions and inadequate basicservices such as water, electricityand wastedisposal.

b. Inflow of migrants from other areaswill result in increased demand forhousing, transportation, educationand other social services.CALABARZON may experience theproblemsbesetting MetroManila.

17


c. On the relocation of displacedfarmer beneficiaries to marginallands, costs to make these poorgrade lands productive increase. Acrucial point concerns not onlyacreage but the technicalpossibilities and constraints in theconversion of presently marginallands to active farming. Thebenefitsthat may be obtained fromthe development of rice lands andits replacement by the conversionof marginal farmlands may not beworth the risk taken in theprocess.

d. The social component is treatedwith much less enthusiasm than itdeserves. While the plan hasstated its development goals ofproductive employment, equity,social justice, and socialdevelopment, much has to bedone to translate these intoconcrete actions. Economic andsocial components should bebrought together and be mutuallysupportive of each other.Possession of land bears with itthe ability to providepeoplewith ahigher levelof economicstanding.

The effects mentioned may lead to anumber of potential impacts which includethe following:

1. Positive sd'cio-economic impacts

a. new employment opportunitiesJlivelihood

b. increased wealth for thecommunity

c. better accessto remoteareas andgoods and services because ofnew infrastructure

d. increasedeconomicactivity

2. Negative socio-economlc impacts

a. introduction of new diseases

b. reduction of services available tothe host population due toincreasein density

c. reduced yields and incomes andlong-term environmentaldegradation through lack of landfor population expansion

d. impoverishment

e. social conflicts caused bycompressing disparate culturalgroupsintoa singlearea


3. Impacts on sensitive ecologIcalenvironmentsa. reduction in the population and

biodiversity of plant, fish and animalspecies

b. reduction in animal and plantproductivity

c. possible loss of wildlife areas due toincreased pressure on remainingwilderness areas

4. Impacts on the natural resource basea. natt:lral resource exploitation and

depletion due to greater populationdensities

b. excessive competition for land, surfaceand ground water supplies, wildlife,fish, timberand naturalvegetation

IV. CONCLUSION ANDRECOMMENDATIONSThe paper recognizes the positive effects

and impactswhich the provision of housing cancontribute to the over-all improvement of theindividual, the community and the environment.However, it cannot be denied that certainconcerns have to be addressed with theconversion of the use of lands specifically intoresidential purposes. Foremost of theseconcerns lie in food securityand self-sufficiency.It has been argued that because of these,agricultural lands cannot be invoked forsocialized housing or low-cost housing. Butneither is it true to say that retaining agriculturallands defeats the purpose of comparativeadvantage becauseeconomicdevelopment doesnot solelyrely on industries.

There are lots of arguments on landconversion. The list mentioned in this paper isnot exhaustive. The SUbject can never really besettled if one sector insists on having its owninterestover the other. Indeed, difficult and evenpainful options have to be made. Conditionshave to be set. The final decision has to bebased on what is for the greater good andinterest of the people and that which is inaccordance with the principles of sustainabledevelopment.

The following recommendations are mereproposals. Somesectors haveopenlyadvocateda few of these suggestions. The primaryconsideration lies in government supportand theattainment of its vision for the country. Theseactions must be supported by peopleempowerment and initiatives to ensurethat bothgoverOlT'ent and people are in accord with thecall of social and economicdevelopment basedon soundenvironmental principles.

18

1. Conduct a macro-level over-allassessment of the entire CALABARZONto determine the availability of criticalresource components and the capacityofthe environment to absorb proposeddevelopment opticns.

2. Review the plan for the CALABARZONfrom the perspective of application of theconcept of "Environmental Managementof Sustained Economic Growth."

3. Research studies to upgradeenvironmental planning to better protectand service urban settlements in thecontext of industrial expansion andurbanization.

4. Formulation of an explicit land use policythat will serve as the framework of actionof local government units in delineatingtheir respective landuses.

5. Encouragement of a strong socialaccountability among the investorsshould be exerted together with privatesector participation in financing largescale investment.

6. To make development plans moremeaningful at the local level, theparticipation of local government,community-based organizations andother non-government organizationsshould be encouraged. Communityparticipation is very crucial in identifyingland uses and appropriate industries.This also allowscheckandbalancewithinthe administrative structure and in theprocessof approving conversion.

7. Inclusion of a program for increasedenvironmental awareness andconsciousness to balance the expectedintensification of the clamor forindustrialization and, in the process,create a corporate and public attitudesupportive of sustainable developmentconcepts.

8. Utilization of idle or vacant lands toreduce sprawl and help the preservationof agriculture lands. This also reducesduplication of urbanservicesand utilities,and for developers, an opportunity torespond to new markets. Imposition oftaxes on idle lands can encourage moreefficientutilization of these.

9. Provision of development skills for localgovernment officials in land use planningwould result in efficient, effective, andrational landutilization andmanagement.


Annex A: Present General Land Use in CALABARZON

Total Provincial 128755 100 175973 100 316581 100 130892 100 870660 100 1622861 100

Agricultural 83149 64.6 96494 56.0 201538 63.7 19037 14.5 452235 51.9 854453 527

Crops:

» Paddy: 6578 5.1 22300 12.7 2300 07 3531 2.7 21922 2.5 56631 3.5

Irrigation

» Paddy: 22095 17.2 1036 0.6 37556 11.9 4015 3.1 16718 1.9 81420 5.0

Non-Irrigation

» Other 4938 3.8 1980 1.1 3989 1.3 44 0.0 13626 1.6 24577 15

Seasonals

» Fruit Trees

» Banana 12267 9.5 1497 0.8 990 0.3 1215 0.9 0.0 0 15963 1.0

» Coconut 20904 16.2 55871 31.7 51949 16.4 2119 1.6 47236 5.4 178079 11.0

» Coconut! 166 0.1

coffee

» Coconut! 300 0.1 1852 0.2 2152 0.1

lanzones

» Coconut! 6238 2.0 29541 3.4 35689 2.2

banana

» Coconut! 26450 8.4 309246 35.5 335696 20.7

shrubs

» Sugarcane 10397 8.1 11824 6.7 70304 22.2 92525 5.7

» Other 5970 4.6 3672 2.1 606 8021 588 18857 1.2

Perennials

Forest and 14129 11.0 25048 14.2 18817 5.9 16646 12.7 280364 32.2 355006 21.9

Woodland

Bamboo 873 0.7 10149 3.2 5742 4.4 16764 1.0

Pasture 320 0.2 690 92 11596 1.3 12698 0.8

Grassland and 20565 16.0 38855 22.1 74856 23.6 71968 55.0 75977 8.7 282221 17.4

Shrubland

Wetland and 1788 1.4 304 0.2 2437 0.8 27590 3.2 32119 2.0

Special UseAreas

Built-Up Area 8251 6.4 10592 6.0 7040 2.2 15231 11.6 2424 0.3 43538 2.7

Mining and 64 0..0 276 0.1 1520 1.2 16 0.0 1876 0.1

Quarrying

Riverwash 346 0.2 356 0.0 702 0.0

Beach Sand 406 0.1 293 0.0 699 0.0

Rivers and 322 0.2 1062 0.3 442 0.3 1306 0.2 3132 0.2

Lakes

Reservoir 1174 0.7 1174 0.1

Kaingin 774 0.4 304 0.2 30099 3.5 31177 1.9

Source: Bureau of Soils, Department of Agriculture

19


10. TO ensure protection of good agriculturallands from unnecessary conversion tourban uses, the concept of the Network ofProtected Agricultural Areas (NPAAs)developed by DA should provide a basis forland use decisions. The NPAAs indicate thelevels of restriction from conversion - fromconditional to moderate to high. Priorityshould be given to the marginallysustainable lands, designated as"conditionally restricted" areas. Extremenecessity could justify conversion of"moderately restricted" areas and should besubjected to Environmental ImpactAssessment Studies. Highly restrictedagricultural areas must be considered nonnegotiable.

However, refinement on some of theitems should be made specific in order toavoid ambiguous interpretations in thefuture. Policies in support of the NPAAs,such as those to make agricultural usemore competitive with other uses should bemade more explicit.

11. The Key Production Area (KPA)development approach also advocated byDA can serve as a framework in enablingfarmers and fisherfolk to increase theirincomes and realize a better quality of lifethrough the best returns on theirinvestments.

The KPA approach identifies andfocuses government support on priorityareas where agro-climatic factors andmarket conditions are favorable forproducing, processing and marketingspecific products.

12. Finally, mitigation measures that can protectthe environment from the adverse effects ofland use conversion can be implemented.Some of the key options which can beconsidered are the following:

a. establishment of a data base to includeinformation on the population, resourceuse patterns, fauna and flora, socialinfrastructure, public health conditionsand institutional assessment;

b. introduction of a monitoring andevaluation scheme to periodicallyassess predicted and unpredictedimpacts of resettlement;

20

c. training of local people especially forless skilled jobs, making specialefforts for minorities and disabledindividuals;

d. strengthening existing localinstitutions or developing new onesto undertake long-term developmentand regional planning and handle anincreased number of disputes andsocial problems; and,

e. provision of social, psychologicaland counseling services to old andnew residents to enable them tocope with socio- economic changes,particularly for vul-nerable groupsand the aged.

BIBLIOGRAPHY

Goals, Standards, Social Indicators andPopular Participation. The Social Impactof Housing. Report of an InterregionalSeminar on the Social Aspects ofHousing, New York: United Nations,1977.

The Master Plan Study on the ProjectCALABARZON - Final Report.Department of Trade and Industry,October 1991.

The Medium-Term Agricultural DevelopmentPlan, 1993 - 1998. Department ofAgriCUlture, November 1993.

Elements of an Effective Agricultural Land UseConversion Policy, Rules andRegulations. Gerardo Calabia. A Paperpresented at the National Symposium onAgricultural Land Use and SoilConservation, 10 June 1991.

Guidelines for Land Allocation andConversion. Prepared for the AustralianAssistance to Physical Planning. NEDANLUC, January 1993.

Project to Develop Land Use ConversionGuidelines - Report on Land ConversionPractices. NEDA-NLUC, November 1992.

Regional Development: Issues and Strategieson Urbanization and Development.Philippine Development Planning Studies.Regional Planning Studies Series, Nos. 1and VIII. NEDA, 1982.

CALABARZON Master Plan: Issues andImplications. A Report by the PhilippineConsultative Panel chaired by Carlos P.Ramos. Ramon Magsaysay AwardFoundation, July 1991.

LAND USE CONVERSION AND THE DEVELOPMENT PROSPECTS OFMALOLOS, BULACAN

Sem H. Cordial, Genice L. Bodeta, Gladstone A. Cuarteros, Joey S. Sena,Edgar L. Dona, Mario Libiran, Merci L. Angeles

I. INTRODUCTION

A. Background of the Study

The pace of change in areas on and near thefringes of Metro Manila has stepped up in recentyears. A key manifestation of this rapid change isthe transforming rural landscape asa result of theconversion of agricultural lands into other uses.

Sulacan stands as a clear example of anagricultural area bowing to increasing urbanpressures. All of its towns are experiencing, invarying intensities, the pressure to convert parts oftheir extensiveagricultural holdings.

Interestingly, land use conversion is arestricted activity under the ComprehensiveAgrarian Reform Program (CARP), a banner socialjustice undertakingof the government.

The pace and extent of the land useconversion process indicate profound changes inareaswhere the phenomenonis occurring.

B. Problems and Objectives of the Study

This study took a close look at the landconversion phenomenon. Taking Malolos, thecapital town of Bulacan,as the study area, it soughtto examine its concomitant issues and determinethe development direction of the municipality.Specifically, the study aimed:

1. To determine the status of land conversion inMalolos;

2. To identify the actors and factors that governland conversion in the municipality;

3. To document the land conversion process anddeterminetheir adherence to policy;

4. To determine the implications of landconversion to the stakeholders and thedevelopmentpath of the municipality; and,

5. To determine the degree of convergencebetween regional development theory andpractice.

C. Significance of the Study

The study provides empirical evidence of thethreats and opportunities inherent in unregulatedland conversionthat a community faces. It adds toa growing body of literature on the land conversionphenomenon around Metro Manila. As of presenttime, most of the literature focuses on the South,the choice of a town on the northern fringe wouldserve to even out this trend.

Finally, it provides a fresh and well-groundedargument for the enactment of, at the very least, acomprehensive town plan for municipalitiessimilarly situated, in order to forestall dangers andchannel development impulses to social andeconomic areas consistent with the desires of thecommunity.

II.RELATED LITERATURE

The rash of conversion of land to nonagricultural purposes that have taken place,particularly in the face ofthe implementation of theCARP has been cited by Nantes as early as 1992.Her study revealed that legal and illegalconversions are common in the rural fringes of theNational Capital Region and there may be reasonto believe that more illegal conversions actuallyoccur than are reported in official governmentrecordsor as acknowledged by local officials.

Cabrido cited the food security implications ofthe land conversion issue. In his paper, he statedthe need "to preserve prime agriCUltural lands anddirect urban expansion away from them becausethese lands serve as food baskets of the countryand are critical resources in achieving food securityfor both present and·futuregenerations."

Cabrido's statement raises the fundamentalquestion of whether food security pertains to selfreliance in agricultural production or food

21

PHILIPPINE PLANNING JOURNAL Vol. XXVIII, No.2 April 1997

sufficiency. The former focuses on local (area)production, while the latter is directedto distributionconcerns. This is an importantdistinction becauseof its implications in the evaluation of theconversion issue (and the resulting loss of localagricultural productionareas).

Other references used by the researchersincluded the National Economic and DevelopmentAuthority's land Conversion Study which outlinesthe underlying causes and possible implications, ona national scale, of land conversion and Silva'sseries on the effects of land use conversion in theCALABARZON area. The latter is focused on theenforcement of the land use conversion proceduresand payment of disturbance compensation andother effects on the farmers affected byconversions in the area.

A textbook by Bryant, et ai, provided anexhaustive discussion of the effects of the city onits adjacentrural areas.

III. THE STUDYAREA

Malolos lies around 40 kilometers from MetroManila (see Figure 1). Except for its historicalsignificance, and its primacy as provincial capital,Malolosis a typical town in Bulacan.

Malolos was the seat of govemment of theFirst Philippine Republic proclaimed in 1898. Itwas in Malolos where the first PhilippineConstitution was drafted. In the municipality standsBarasoain Churchwhich housed the framers of thefirst Republican Constitutionin Asia.

Despite its distinguished history, Maloloscontinues to be predominantly rural andagricultural. It is characterized by small agriculturalbarangays where neighborhood ties are strong. Itspeopleexude strong traditionalvalues.

According to its 1990 social, economic andphysical profile, 4,707 (73.4%) hectares areagricultural; 1,549.85 has. (24.2%) are residential;13.98 has. (0.2%) are commercial; 106.44 has.(1.7%)are institutional; and, 37.40 has. (0.6%)areopen spaces.

Of the agricultural areas, 2,804 has. (36.3%)are devoted to crops and 1,909 has. (24.5%) aregiven to aquaculture. The northern portion ofMalolos is devoted to rice production and thesouthernportion to fishing and aquaculture. Of the2,804 hectares for crops, 2769 (98.8%) areirrigated ricelands. Other crops produced are

22

permanent fruit crops, fruit vegetables and leafyvegetables. The other commercialcrops are sugar,tobacco, mongo,peanuts, and bananas.

Today, however, Malolos, like the rest ofBulacan, is in the throes of change. Through theprocess of land conversion, a large portion ofMalolos, particularlythose near the Poblacion, hasbeen transformed from its original agriculturalcharacter into residential zones and commercialestablishments. This is attested to by theconversion of agricultural areas near the Poblacionand along the national road into other uses. Onlythe more remote areas, particularly those locatedfarther away from the national road and thePoblacion, are shielded for now, from the rushingchange.

A key issue relatedto the study is that Malolos,as with the province of Bulacan, does not have acomprehensive land use or town plan. Based oninformation gathered by the researchers, thedocuments at both the municipal and provinciallevels are currently being revised. As these plansoutline the general guidelines and policies on theusage and allocation of land as an importantresource, their absence makes it nearly impossibleto check land conversions in the area.

Due to Malolos' characteristics as definedabove, the town stands as a perfect laboratoryforexamining the phenomenon of land useconversion. Changes taking place as a result ofconversion are vivid physicallyand psychologically.

IV. THE LEGAL FRAMEWORKOF LAND USECONVERSION

The guiding principleon land use conversion isto preserve agricultural lands. Conversion ofagricultural lands may be allowedwhen its purposecoincideswith the objectivesof the ComprehensiveAgrarian Reform law (CARL) to promote socialjustice, industrialization, and the optimum use ofland as a national resourcefor publicwelfare.

Hereunder are the legal issuances and theirpertinent provisions that bear on the topic understudy:

A. Definition of Terms

1. Agricultural Land - refers to land devoted toagricultural activity and not classified asmineral, forest, residential, commercial orindustrialland (Section3(c), RA 6657).

LEGtNp: Ri..,.,. _: Rood

F!¢lwoyeQ9lfCltPt'Ol(lndGl CapllolCitYTown

23

Land Use Conversion and DevelopmentProspects

LOCATlONMAP

SCALE

PHILIPPINE PLANNING JOURNAL Vol. XXVIII, No. 2 April 1997

2. Land Use Conversion, Land Conversion orConversion - refer to the act of changing thecurrent use of a piece of agricultural land.

3. Reclassification of agricultural lands - is theact of specifying how agricultural lands shall beutilized for non-agricultural uses as embodiedin the land use plan. It also includes thereversion of non-agricultural lands toagricultural use.

4. Comprehensive Development Plan - refersto a document embodying specific proposalsfor gUiding, regulating growth and/ordevelopment. Its main components are thesectoral plans (i.e., socio-economlc,infrastructure, local administration) and theland use plan.

5. Comprehensive Land Use Plan - refers to aplan which includes a land use map, thefactors indicating the socially desired mix ofland uses, and a set of policies to guide futuredevelopment.

6. Zoning - is the delineation/division of acity/municipality into functional zones whereonly specific land uses are allowed. It directsand regulates the use of all lands in thecommunity according to an approved oradopted land use plan for the city/municipality.lt prescribes setback provisions, minimum lotsizes, building heights and bulk.

7. Zoning Ordinance - is a local legal measurewhich embodies regulations"affecting land use.

8. Private Agricultural Lands - are landsdevoted to or suitable for agriculture as definedin RA 6657, and owned by natural or juridicalpersons or by the government in its proprietycapacity.

B. Legallssuances

1. Executive Order 129·A, Series of1987 statesthat the Department of Agrarian Reform (DAR)is given exclusive authority to "approve ordisapprove applications for conversion,restructuring or readjustment of agriculturallands into non-agricultural uses (Section 4).

24

2. Republic Act (RA) 6657, otherwise known asthe Comprehensive Agrarian Reform Law of1988, likewise empowers DAR to authorize,under certain conditions, the reclassification orconversion of agricultural lands (Section 65).

3. Memorandum Circular No. 54, Series of1993 of the Office of the President, providesthat "action on applications for land useconversion on individual landholdings shallremain as the responsibility of DAR, whichshall utilize as its primary reference documentson the comprehensive land use plans andaccompanying ordinances passed upon andapproved by the Local Government Units(LGUs) concerned, together with the NationalLand Use Policy, pursuant to RA 6657 and EO129-A." (Section 4).

4. RA 7160, the Local Govemment Code of1991, provides that a city or municipality mayreclassify agricultural lands through anordinance enacted by the Sanggunian afterconducting public hearings for the purposeprovided that there exists an approved zoningordinance implementing its comprehensiveland use plan." (Section 20).

5. The Department of Justice (DOJ) OpinionNo. 44, 1990 states that "the legalrequirement for the DAR clearance in cases ofland use conversion from agricultural to nonagricultural uses applies only to conversionsmade before June 15, 1988, the date ofCARL's effectiVity."

6. DAR Administrative Order No. 12 issued in1994, consolidated and revised all eXistingimplementing guidelines issued by the DAR,taking into consideration other presidentialissuances and national policies related to landuse conversion and came up with the "Rulesand Regulations on Land Use .Conversion."Today, lt : is the principal document thatgoverns land conversion.

C. Conditions Not Allowing Conversion

The legal issuances cited above set out theconditions under which conversions shall not beallowed. These are as follows:

1. Lands in which the DAR has already issued aNotice of Acquisition under the compulsoryacqUisition (CA) process;

2. Lands with standing Voluntary Offer to Sell(VaS) or an application for stock distributioncovering the subject property which has beenreceived by DAR;

3. Lands where there is already a perfectedagreement between the landowner and thebeneficiaries under the Voluntary LandTransfer (VLT);

4. Irrigated lands with inadequate water supplybut fall within the areas scheduled for irrigationfacility rehabilitation by the Department ofAgriculture (OA) and the National IrrigationAdministration (NIA); and,

5. Areas already covered by proposed irrigationprojects with firm funding commitments at thetime of the application for land conversion orreclassification. .

D. Conditions Allowing Conversion

1. When the land ceases to be economicallyfeasible and sound for agricultural purposes.

2. When the land or locality has been highlyurbanized and has substantially greatereconomic value for residential, commercial orindustrial purposes.

3. When the land, at the time of application, hasalready been reclassified as commercial,industrial, and residential in the new or revisedtown plans;

4. When the proposed use is similar orcompatible with the dominant use of thesurrounding area.

5. When the land has already been classified orzoned for non-agricultural uses by LGUs andapproved by the Housing and Land UseRegulatory Board (HLURB) prior to theeffectivity of the CARL.

6. When private agricultural lands or portionsthereof have been exclusively, directly andactualiy used for livestock, poultry and swineraising prior to the effectiVityof the CARL.

7. When the five year duration from the reward ofthe CARP entitlement has already lapsed andthe beneficiary has fully paid all financialobligations.

8. When the proposed project is viable andbeneficial to the community affected and thatthe land development phase of the area will becompleted within one (1) year from theissuance of the conversion order.

Land Use Conversion and DevelopmentProspects

E. Major Documentary Requirements forConversion

1. For major development projects: certificationfrom the OENR that the proposed conversionis ecologically sound; proof of financial andorganizational capability to develop the land;statement of justification on the economic andsocial benefits of the project and the locationplan/vicinity map of the land.

2. Certification from the OA that the land ceasesto be economically feasible or sound foragricultural purposes.

3. Certification from HLURB regarding thereclassification of the land.

4. Certification from the LGU regardingreclassification and zoning of the land.

5. Certification from Municipal Agrarian ReformOfficer (MARa) that there are no CARPbeneficiaries in the land.

6. If land has qualified agrarian beneficiaries,proof of payment ofdisturbance compensation.

7. For CARP beneficiaries: certification from OARthat the five-year duration has already lapsed;certification from the Land Bank of thePhilippines (LBP) that the farmer-awardee hasfully paid all financial obligations; certificationfrom Provincial Agrarian Reform Officer(PARa) that farmer-beneficiaries have agreedto conversion.

F. The Legal Land Use Conversion Process

1. Applicant secures certification from concemedgovernment agencies (see preceding section).Along with the title of land being applied forconversion and DAR forms, he files applicationwith the Regional Center for Land Use Policy,Planning and Implementalion (RCLUPI).

2. The RCLUPI conducts field investigationregarding the application's adherence torequirements and posts notices of theproposed land conversion.

3. If application passes RCLUPI tests, and

25

PHILIPPINE PLANNING JOURNAL Vol. XXVJJJ. No. 2 AprIl 1997

3.1 if subject land is 5 hectaresor less in size.the RCLUPI returns the approvedapplication to the Regional AgrarianReform Officer (RARO). Conversion maythen proceed.

3.2 if the subject land is greater than fivehectares but less than 50. the applicationis submitted to the Center for Land UsePolicy, Planning and Implementation(CLUPI,national level).

4. Like the RCLUPI, the CLUPI examines theapplication. If the applicationspass and if

4.1 the land involved is less than 50 hectares,the application is forwarded to theUndersecretary for Policy, Planning andOperationswho approvesthe conversion.

4.2 the land is 50 hectares and above in size,the application is forwarded to thePresidential Agrarian Reform CouncilLand Use TechnicalCommittee(PLUTC).

5. Like the RCLUPI and the CLUPI, the PLUTCexamines an applicationand if it is sound, theapplicationis endorsed to the AgrarianReformSecretaryfor approval.

6. In the case of lands above 50 hectares,conversioncan proceed only after the processat the national level (see figure 2).

V. THEORETICAL CONSIDERATIONS

This study is grounded on two importanttheories in regional planning: the growth pole anddependencytheories. Both are useful in analyzingthe development prospects of Malolos asspecifically exhibited by the present character ofland use conversion in the town and the entireprovinceof Bulacan.

Briefly,the growthpole model presupposes thepresence of a lead industry or center that wouldgenerate impulses which would attract alliedbusinesses towards it, and once a critical mass hasbeen achieved, generate development impulsesthat would trickle down and foster development inadjacentareas.

The dependency theory assumes theexistence of a core - the primate city • whichdictates the type of development that would occurin its peripheries. Andre Gunder Frank,

26

enunciating one of the many versions of thedependency theory. suggested that the worldconsistsof an intemationalandsubnational systemor chain of metropolises and satellites. the formerholding power over the latter. The system "runsfrom the world metropolisto the haciendas or ruralmerchants who are satellites of the localcommercial metropolitan center, but who in turnhave peasants as their satellites." The termmetropolis and satellite refer both to social groupsand spatial units.

The powerstructure, as described,leads to themisuse and misdirection of the resources of thesatellites. including expropriation and appropriationby the metropolis, that leads to disparities in theurban-rural relationships and the underdevelopment of the satellites.

The spatial configuration implied in each of thetheories applies aptly to the conditions of Malolosand Metro Manila. Malolos has been identified aspart of the NationalCapital Region's "outer core" inthe recently formulated Physical DevelopmentFramework Plan for Metro Manila, 1996-2016. Aspart of the outer core, Malolos serves as a majorsource of agricultural products needed by MetroManila residents and a recipient of spill-overdevelopments in the primate city. Since NCR canno longer fully provide the settlement needs of themetropolitan popUlation as well as the sites andservices reqUired by new investments, it isexpectedthat the outer core will provide the spacerequirements for these.

It was also indicated that Metro Manila would"continue to strengthen its position as the premiercenter of decision making particularly in theeconomic concerns of the nation." The expecteddevelopment in Malolos could then be viewedmerely as a furtherance of the control of Manilaover the area. Accordingly, the land useconversion in Malolos may be viewed within thisframework(see Figure 3).

VI. METHODOLOGY

A. Data Generation

The study made use of both primary andsecondarydata sources. In view of the limited timeand resources available, the task was dividedsectorally into government, non-governmentorganization and farmer groups, and the privatesector, particularly the investors and real estatedevelopersin the area.

Land Use Conversion and Development Prospects

APPLICANT

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27

PHILIPPINE PLANNING JOURNAL Vol. XXVIII, NO.2 April 1997

Fig. 3. T",Sttadyli'rame.wol'k

LMmrQ Manila

0tMt :\(kt.roal)

lnfIuencM N MALOL0SImpuleu

DEVEL0PMENTD-Actors-Factor.

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Based on this division of labor, research wasconducted in the central and field offices ofgovernment agencies involved in land useconversion and land development process, namelythe DA, DAR, and HLURB. Similar data collectionwas done at the offices of the Governor of Bulacanand Mayor of Malolos. Related research andreports from the academe and the private sectorwere likewise studied.

The information gathered was supplementedwith interviews with key personalities in Malolosand Bulacan in general. The research teamprepared guide questions for the interviews and aquestionnaire for the business sector.

On the side of the government, a key officer ineach of the relevant agencies was interviewed.The research group also touched base withrepresentatives of private business in Malolos.

Representatives of farmer groups and nongovernmental organizations (NGOs) engaged inrural and agricultural development, particularly thelocal leaders and farmer-members of theAlyansang Magbubukid sa Bulacan were likewiseinterviewed. The information required fromdeveloperswas gathered from their counterparts inMetro Manila.

28

B. limitations of the Study

The limited time and resources available to theresearchers as well as the businesspersons'natural disdain for interviews - especially oncontroversial SUbjects such as land conversion limited data gathering from the private sector.Direct data was also not gathered from theinvestors and owners of projects with pendingapplications for land conversions. Also, the studywas not able to pursue an investigation of theexisting industrial estate of Malolos, especially itsimpact on the farmers formerly tilling the land onwhich the estate stands, and on the local economyconsidering employment generation, taxcontribution, and promotion of allied businesses.

VII. RESULTS AND DISCUSSION

A. Status of Land Conversion

1. The Situation in the Province

The records gave a more than indicativepicture of the land use conversion activities inMalolos town and the province of Bulacan. Theyinclude land conversions that have been applied forand those that have started without complying withthe legal requirements. The latter has been listedeither as "unauthorized"and "alleged illegal."

As of yearend 1996, some 1878.66 hectares ofagricultural land in the entire province of Bulacanhave either been converted or earmarked forconversion to various non-agricultural uses. Ofthese, 1,389 hectares were applied for conversionwith the DAR and 489 were listed as unauthorized.Of these illegal conversions, San IIdefonsoaccounted for 134 hectares. Baliwag had 96,Meycauayan 56, and Malolos 53 hectares. Thesefigures do not include actual conversions and ongoing land development activities that take placeeven before their respective applications (forconversion) are acted upon.

Of the total land area planned for conversion,1,238 hectares were for residential projects, 406 forcommercial and 233 hectares for industrial. Ofthose planned for residential projects, 998 hectareswere applied with the DAR while 240 were not; forthe commercial, the ratio was 283 to 122; and forindustrial, 107 to 126 (see Table 1).

Table 1. Size of Land Use Conversion inBulacan by classification and purpose(as of 31 Dec. 1996)

Purpose

Classification Industrial Commercial Residential Total

With 107.0 283.9 998.0 1389.0Application

Unauthorized 126.9 122.6 240.2 489.6*

Total 233.9 406.5 1238.2 1878.6

The USAID-assisted Governance for LocalDemocracy project currently being implemented inBulacan assessed that eight of the province'smunicipalities located within a 70-km radius fromMetro Manila exhibited land conversion areasranging from approximately 100-350 hectares eachin the last five years. San Jose del Monte andPlaridel lead the pack with 375 and 345 hectaresrespectively, while Meycauayan and Marilao eachhave 93 hectares. Malolos, together with SanIIdefonso, Hagonoy and Baliwag have conversionsof 100-150 hectares each. More recent information(year ending 1996), however, would show thatthese figures are grossly under-reported. OARrecords indicate that San Jose del Monte, forinstance, has converted or is in the process ofconverting 616 hectares; Plaridel 245 hectares;Malolos and Meycauayan each at 126; and Marilaowith 112 hectares. These are those withpending/approved applications. If unauthorizedconversions are included, these figures increase to:San Jose del Monte, 639; Plaridel, 254; Malolos,178; and Meycauayan, 183 hectares.

Land Use Conversion and Development Prospects

There were a total of 101 applications from1988 to 1996. The volume of applications variedby year with the largest posted in 1991, one yearafter the DOJ opinion on conversion waspromulgated. This trend is illustrated in Figure 4.

Figure 4. Trend of Conversion Applicationsin Bulacan

1nl U" I~~. I'"

~..~..~

2. The Malolos Case

The records for Malolos showed an uncannyresemblance to that of the province. Some 178hectares have been applied for the comparativeperiod. This is composed of 126 hectares withapplications and some 51 hectares unauthorized.

By purpose, the lands are divided into 117hectares for residential projects, 31 hectares forcommercial use and 29 hectares for industrialdevelopments.

Of the lands planned for residential projects,81.3 hectares were with applications and 35.9 hadnone. Of those for commercial, 18.2 were withapplications and those 13.2 without. For industrial,26.8 had applications and 2.9 without.

Of the 126 hectares applied for the town, some97 hectares have been approved for conversion asof end-1996. Of these, 66 hectares were forresidential projects, 7 hectares were forcommercial ventures and 26 hectares for industrialuse (see Table 2).

Table 2. Size of Land Use Conversion inMalolos by classification andpurpose(as of31 Dec. 1996)

Pur lOseClassification Industrial Commercial Residential TotalWith 26.8 18.2 81.3 126.3ApplicationUnauthorized 2.9 13.2 35.9 52.0Total 29.7 31.4 117.2 178.3

29


As of the end of 1996, nine applications forconversion in Malolos have been filed. Two werefiled in 1991, three in 1992, and one each in 1994,1995 and1996. The trend in both number ofapplications and size of land applied for is plotted

. in Figure 5.

Figure 5.

1 2

i':u,j! I

Trend of Conversion Applicationsin Malolos

For the latter, a total of five land developmentcompanies were chosen and after explaining thenature of the study, three sets of questionnaireswere provided to each. Only 6 of the 15questionnaires were accomplished and returned.

b. Summary of Survey Results

The interviews and questionnaires showed thatan alleged shortfall in the supply of housing inMetro Manila due to high cost of land hasnecessitated an outward movement of residentialdevelopment projects to adjacent and readilyaccessible provinces. They emphasized thecollusion of two important elements: linkage toMetro Manila as a primary employment zone(importance of accessibility considerations andtransportation facilities) and relatively low land rent.

I~ 1~ 1_ 1~ I~ 1~ ,_ ,_ t_~

3. Affected Farmers

The DAR records did not include the numberof farmers affected by the land conversions, exceptthose classified as unauthorized and alleged illegal.The apparent assumption is that the farmersaffected by legal conversions were fullycompensated according to the law.

Still, the count of affected beneficiaries is atbest incomplete. Most of those conversions listedas unauthorized or alleged illegal did not have therelated information. But those that have beenregistered counted among them 75 beneficiaries.

B. Results of Sectoral Interviews

1. Business Sector

a. Selection and Profile of Respondents

To elicit views from the different segments ofthe business sector, a sample composed of localbased business interests and representatives ofexternal-investors was interviewed.

Included in the sample were those directlyinvolved in land development or conversion andthose who depend on the land as a productiveinput. Representatives from the services andmanufacturing industries (of the local economy)were also included to capture the sentiments ofpeople who were not directly involved in the issueof conversion.

30

The respondents noted, however, thatsouthward developments (l.e., into Laguna-CaviteBatangas area) presently outpace those in theNorth. The extensive industrial developments inCALABARZON are large factors for theattractiveness of this area. This may be coupledwith the constraint offered by Bulacan'sconsiderable and vast ricelands together with itsaquaculture tradition which makes use of extensiveareas of real estate.

When asked on the role they perceived theprivate sector is supposed to play in the overalldevelopment process, the respondents wereunanimous in saying that they provide both thehuge amounts of capital needed as well as theinitiative in developing areas. Local govemmentunits were seen as merely support mechanisms inthe market- dominated development arena. Somerespondents even felt that govemment policies arenot coherent, and where explicit guidelines wereprovided, bureaucratic red tape was considered aburdensome reality.

On the aspect of local development plans andzoning regulations, most assumed that they wereabsent since the developer's proposals areapproved with minor revisions even when these areprepared independent of the town's land use plans.Where projects are temporarily shelved, politicalconsiderations rather than technical objectionswere often seen as the CUlprit.

On the importance of agriculture in nationaland local development efforts, majority of therespondents agreed that it plays a vital role.However, it was confusing to note that while thevalue of agriculture was recognized, some

respondents held the notion that "agricultural areaswill eventually have to give way toindustrial/commercial and residential development"as the natural course of events. And although adiminishing amount of agricultural areas (on anational scale) was considereda cause of concern,many respondents said that the positive results ofconversion, such as industrialized status, increasedlocal government revenues, and enrichment ofagricultural land owners, still outweighed thenegative implications. They also felt that the areasconverted were usually relatively small. Only tworespondents perceived that there was a rapid rateof land conversion in Bulacan.

Asked whether there is a realistic alternativescheme to horizontal development to address thedemand for urban and/or residential uses, allrespondents answered"yes" but clarified that these(e.g., vertical developmentand other forms of masshousing technology) may not be appropriate in arural agriculturalsetting.

Interestingly, the respondents believed that anagriCUlture-led development strategy (which isnecessary if conversions are to be minimized) wasnot a viable option. Rather, industrial developmentas exemplified by the CALABARZON project wasseen as the necessarydevelopmentcatalyst.

It should be noted that most of therespondents were marketing personnel and, thus,were not very familiar with the legal processesinvolved in land conversion. Insights into howdevelopers overcome problem areas during theapplication period for conversion, as perceived bythe private sector, could have yielded significantinformation.

Finally, the respondents noted that whilesouthward development was presently moreattractive, the northern section (Bulacan, forexample) would eventually experience similardevelopments. The continued growth (spatial andeconomic) of the National Capital Region willcontinue to dictate this process. However, therespondents stressed the need for infrastructuredevelopment, like expanded road systems andwaterworks, to warrant the attention of investors.

31

LandUse Conversion and Development Prospects

2. Farmer Groups

a. Profile of Respondents

The respondents in the interview and focusedgroup discussion were leaders and farmermembers of the Alyansang Magbubukid saBulacan, an organization which (according to itsleaders) championsthe rights of farmers.

b. Summaryof Survey Results

Yhe respondents emphasized that genuineland reform which guarantees that farmers wouldeventually own the lands they till and benefit fromtheir produce could quell unrest in the ranks offarmer groups. They emphasized, however, thatmere distribution of lands does not constitute landreform. Provision of accessible support services,like credit lines, affordable and reliable irrigationservices, fertilizers, pesticides, and price supportmechanismsare equally important.

The farmer leaders also said that on thestreets and among the masses, it has beenmaintainedthat genuine land reformwill lead to theempowerment of local farmers. They can be thepropulsive sector of a developing economy andtheir first role will be to provide for adequate foodproduction. Farmers were generally not keen onthe idea of food importationas a long-term solutionto food security.

On the issue of land conversion, farmers wereseen as the eventual losers especially as thepressure to sell is strong. The respondents saidthat even if a farmer initially refuses to sell hispiece of land, the circumstances compel him tomore difficult situations. Debts owed to amiddleman (usurer), conversions of adjacent lotswhich undermine the productivity of one's farm lot(due to proliferation of rats, destruction of naturalirrigation systems,which are among the detrimentaleffects to the ecosystem) and perceivedimprovements in the living conditions of those whohave agreed to the conversions are pervasivepressures.

Still, some farmers who understand theimplications of disengaging themselves from a lifeof farming hold on to their lands. As they said,"Ang pera ay nauubos, ang lupa hindi (money canrun out but land does not)." Besides, they realizethat the employmentpossibilities of farmers outsideof the agricultural sector are small considering thatmost of them are not highly educatedltechnicallytrained.


Asked to recall the usual pre-conversionprocess, the farmers outlined the process asfollows:Agents of land developersscout around forsuitable areas for their investment requirements.Then, they approach farmers and offer lucrativeprices. While farmers in general have close affinityto land, economic considerations cannot bedismissed.

In highly publicized conversion cases, farmergroups were a distinct segment among oppositiongroups. Mobilizations to such consultations withnationaland local agencies (Senate, Lower House,OAR, PARO, MARO, etc.) were considered asimportant for development inputs. But it wasgenerally felt that "the farmers are not included inthe development (decisionmaking)process."

The role of the MARO, in this respect, is a vitalcog in advancingthe interests ofthe farmers. Yet,according to the farmers, these MAROs do notperform their duties. Unless rallies are held, forinstance, no inspection of lands which haveconversion applications have been done.Numerous cases where irrigated lands have beenendorsed for conversionwere documented.

Likewise, the respondents believe that themunicipal government should act judiciously inconversion proceedings because they have thepower to protect the agricultural lands of themunicipality. To date, accordingto the farmers, noapplications for conversion have been denied bythe local government. They believe that thecreation of a barangay land use committee wouldbe a step in the right direction. This is seen as areiteration of the people empowerment objectiveand concrete translation of localautonomy/decentralization since the barangayresidents who would be affected by the landconversions have intimate knowledge about localconditions (such as the location and extent ofirrigatedareas).

3. The Government Sector

a. Selectionand Profileof the Respondents

The researchteam interviewed representativesfrom the agencies deemed key to the landconversion process. These included the Mayor ofMalolos, the head of the Land Conversion Sectionof the Operations Division of the OAR ProvincialOffice,and the chief of the Research Sectionof theOffice of the Provincial AgricultUrist (OPA). Theheads of the provincial offices of OAR and OPAwere unavailable.

b. Summaryof Resultsof Interviews

b.1. Results of the Interviewwith the Mayor

32

According to the Mayor, the Malolosdevelopment plan is currently being revised.As envisioned, the town wants "balanceddevelopment," a "complete mix" of threesectors, namely: agricultural, industrial andcommercial. Malolos has need for industrialand commercial sites.

Development toward this end is beingplanned along a 12 kilometer strip of theMcArthur Highway that cuts across the town.About 200 meterson both sides of the highwaywill be transformed into industrial-commercialsites. This area covers existing commercialdevelopments laid out in a sprawl in thePoblacion and will extend to currentlyproductivericelands. The plannedcommercialdevelopment is aimed at conserving within thetown the funds that otherwise would be spentby the citizens of Malolos for consumer goodsin Metro Manila. For the industrial sector, lightto mediumindustriesshall be promoted.

In addition, negotiations have beeninitiated by the municipal government with thePhilippine National Railways for the possibledevelopment of the PNR's right of way throughthe town. Another road that aims to divertthrough-traffic away from the town center isbeing planned. This will pass through existingricelands and is expected to encourage thedevelopment of these areas creating anotherroundof conversions.

The Malolos development plan shall becarried out "not to the detriment of anybody"accordingto the Mayor. However, no apparentassistance is planned for farmers andlandowners whose agriCUltural lands havebeen earmarkedfor conversion.

Current land use policies are said to be"unrealistic." In the face of rising land prices,the Mayor said "it is a big sacrifice on the partof the farmer to have his land identified fornon-conversion." Alluding to the policy thatirrigated lands are nonnegotiable forconversion, he argued that while Malolosfarms are irrigated,the service is still seasonal."For every rule, there is an exception,"emphasized the local chief executive. Tojustify his stance, he cited that the LocalGovernment Code of 1991 provides localgovernment units a leverage against restrictivepolicies pertaining to land conversion.Applications for conversion with the LGU areapproved or disapproved by the SanggunianBayan. The trend in the land conversionprocess,it was observed, is toward approvalofapplications "within limits." This explains the

fact that three resolutionssanctioning land useconversions in the town have been passed.

It was noted that resistance to landconversion comes from groups composed ofnon-farmers. Farmers are not excessivelyopposedto the idea, said the Mayor. Farmers'vehement opposition is directed more toward"pagpatay sa kanilang hanapbuhay (loss oflivelihood)."

b.2 Resultsof Interviewwith DAROfficial

Applicationsfor land use conversion in theprovince are decreasing, but conversionactivities are intensifying. In Malolos, theconversion has been observed to be"rampant." The trend on land conversionappears to be that developers or landownersconduct pre-development activities, likedumping or filling and road development,before the agricultural lands are applied forland conversion. Despite the primacy of theDAR in the land use conversion process, itappears that permits from other agencies, likethe endorsement of the Sanggunian Bayanand the permit from the HlURB for residentialdevelopments, are taken as authority toproceedwith the land conversionprocess.

Although nine cease-and-desist orders(COOs) have been issued by the provincialagrarian reform office since 1996, these havelargely been ignored and unenforced by DAR.It was only in 1997, when the Task Force onland Use Conversion was organizedunder theauspices of the DAR that the object of theCOOs took effect. The task force wassupposed to have been organized in 1994 byvirtue of DAR Administrative Order 4 issued in1993, but the Bulacan task force wasorganizedonly in 1996.

The informants explained that in 1996,COOs were simply mailed. In 1997, thispractice was dropped and it became astandard procedure that COOs be personallyserved by membersof the task force or PAROstaff deputized by the task force. So far, forthe COOsissued in 1997, there have been norecordedviolations.

It is not dear among the memberagenciesof the PLUCwhich agency shouldfilethe necessary information with the courts. Assuch, no agency appearsto take the initiative even DAR with its task force. As a result, notemporary restraining order (TRO) has beenreleased to date. Consequently, noconversion activityhas ever been stopped.

33

LandUse Conversion and Development Prospects

One requirement of conversion approvalisthat farmers, especially the ComprehensiveAgrarian Reform Program (CARP)beneficiaries, be paid the due disturbancecompensation. According to the intervieweesthis has been fully compliedwith. The farmer~who opted to sell their lands have beenobserved to use the payment they received forthe ~~lIowing purposes: a) to build houses; b)to diVide the amount among heirs; c) to investin passenger jeepneys and tricycles to serveas alternativesourcesof income.

b.3 Results of Interview at the ProvincialAgricultural Office

Officials are aware of the extent of landconversion going on in Bulacan and Malolos.They agree that the conversion activities areintensifying particularly in areas near thehighway despite the fact that these arecurrently irrigated and productive ricelands.The change is mostly toward residentialdevelopment although there are somecommercial and industrialundertakings. Thereare also tourism-oriented projects, notably aplannedgolf course in San IIdefonsotown.

The increased rate of land conversion isseen as a result of external pressures. Onesuch pressure is the economic overspill fromMetro Manila resulting in a demand to provideresidential units. The direct consequence ofthe Pinatubo eruption in 1991 that displacedhundreds of families in Pampanga due to thelahar flows has intensified migration into theprovince which also affects the level ofdemandfor housing.

There is also a recognition that internalfactors are contributing to the rate ofconversion. According to the respondent,apart from the presenceof local investors, thelocal elective officials are promotingconversion. It is perceived that local officialswant to create monuments during their term.

Bulacan's protected areas for agriculturehave been delineated by the Bureau of Soilsand Water Management. Irrigated andirrigable lands are non.negotiable forconversion as provided in AO 12 but it seemsthis is not true in Malolos. In spite of the factthat 90% of Malolos is irrigated, there havebeen, and still are conversions in theseprotected areas. Most of these conversionsare individually owned parcels from 0.5 to 5hectares. The use of these lands is alteredeither by the owners themselvesor by the newowner-developer.


Most of the towns in Bulacan are stillpredominantly agricultural, but agricultureofficials expect the picture to change with theland conversions. A few years from now,some project that these towns will turnpredominantly industrial and commercial. Theprovincial agriculture office, through theinitiative of the Governor's Office, is nowpreparing for this. They said that they hadbeen tasked to delineate existing agriculturalareas that can be given up and identifyalternative crops that will be introduced to givefarmers higher income. Such a move isdirectly connected with the statement made bythe Provincial Planning and DevelopmentOffice that Bulacan as a whole will tone downthe objective of food security in favor ofenvironmental considerations. Whatparameters will be adopted towards this endremains to be determined.

The conversion is not left unopposed,however. There is resistance from individualfarmers and advocacy groups, like theAlyansang Magbubukid sa Bulacan and theAniban ng mga Magsasaka sa Agrikultura(AMA). The farmers, however, were dividedover the matter. While there are those whooppose, others favor conversion in the hopethat they can be employed by the industriesthat will be established. A significant factor insuch a decision is the high price being offeredfor lots by developers.

Farmers who favored conversion for theirland have been known to dump fillings on it orleave it untilled for three or more seasons togive the impression that the land is alreadyunproductive. The informant stressed,however, that it is impossible for farmers todestroy irrigation systems because this wouldput them in conflict with fellow farmers byobstructing flow of water to the areas of thelatter. At any rate, the SanggunianPanlalawigan has promulgated an ordinancesetting penalties for the destruction of irrigationsystems, including the cultivation of kangkongin natural and man-made waterways.

Farmers who sell have been observed tobuy agricultural lands in areas away from ongoing developments. These agricultural landsare mostly in sloping areas which are cheaper.Their new investments, consistent with the

34

character of their newly bought land, consist oflivestock and fruit-trees, particularly mangoes.Some have engaged in non- agriculturalundel'takings, mostly in construction and alliedactivities. This includes steel fabrication. Thealternative livelihood is consistent with thebuilding boom in Bulacan.

Prices for non-irrigated lands have beenobserved to rise from P 80 per square meter(1994) to the range of P 250-P500 per squaremeter (1997). There was no figure given forirrigated lands. It was gathered, however, thatsome lands have been sold at P 10 million perhectare (P 1,000 per square meter).Presumably this involved productiveagricultural lands near an urban area.

The provincial agriculture office takes analmost passive role in the conversion process.Its officials merely describe the land subject toconversion. It advises the inter- agencycommittee in charge of conversion whether ornot a parcel is irrigated and part of theprotected areas for agriculture for the province.They do not oppose the conversion.

Some effects of conversion have beenobserved. Flooding has occurred in Malolosand this is attributed to residentialdevelopments in former ricelands. Thedevelopments have leveled natural floodways.

VIII. ANALYSIS AND FINDINGS

A. Status and Trend of Land Conversion

1. The data showed that some 178 hectares ofagricultural land in Malolos have beenearmarked for conversion. Of these, 126hectares were with applications and 51without. Of those with applications, 97hectares have been given the go-signal toproceed by the DAR.

2. The composition by purpose of the total landsearmarked for conversion are 117 hectares forresidential projects, 31 for commercial use,and 29 for industrial developments. Thefigures do not reflect the desire of themunicipality's political leadership to have a"balanced development." The locations of theconversions, both legal and unauthorized, arespread out away from McArthur Highway asdesired by the LGU (see Figure 6).

Legend:• Authorized• Unauthorized

LandUse Conversion and Development ProspeCts

Figure 6. Land Use Conversion Sites in Malolos

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35

PHILIPPINE PLANNING JOURNAL Vol. XXVI//, No. 2 April 1997

3. The Malolos land use conversion picturereflects that of the entire provinceof Bulacan.

4. Based on the interviewsconducted, the figuresdo not represent the actual land useconversion picture. The real picture appearsto be worse. This would explain the moves ofthe provincial government to organize a TaskForce on land Developments focused onillegal conversions and the DAR to organizeand mobilize to provide legal muscle to itsTask Force on Illegal land Conversions.

B. Actors and Factors Goveming Land UseConversion

1. There is an interplay of forces that define thecharacter of land conversion in Malolos.These forces are: the rising land values;demand for housing, commercialand industrialspace; investors and developers; governmentand the responses of the farmers andlandowners.

2. The lGU has adopted a de facto open policyfor conversion to promote economic growth inMalolos. Where this policy coincides with themarket demand (private capital from MetroManila supported by local influence andequity), there is no stopping the landconversion process. In this regard, it may besurmised that in Malolos, the chief decisionmakers in the land conversion process are thedeveloper-investors.

3. The. farmers, aided by non-governmentalorganizationsengaged in the advocacyof ruraldevelopmentfocused on the farmers, have putup an admirable though largely ineffectiveresistance to the land conversion process.Some farmers have succumbed to the lure ofeasy money while a slowly diminishing numberhave continued to resist the assault on theirlivelihood.

4. The factors encouraging land conversion varyfrom sector to sector: These are the following:

a. Decreasing Profitability of AgriculturalActivities. Agriculture production has ceasedto be a profitable venture in small to mediumsized farm lots. The increase in competitionbrought by larger companies particularly inlivestock production saw the demise ofbackyard operations. The few remainingventures are those connected with largeintegratorssuch as Vitarich.

36

Unfavorable terms of trade arising from the~ntrol of the entire production cycle by a fewInvestors (notably the Chinese) resulted inruinous fluctuation of prices. Very often,owners and tillers of the land are left with veryminimal profit (even losses) after theincreasing cost of production and other relatedexpenses such as transport and handling areaccounted for. As expected, middlemen whoare normally the agents of the Chineseinvestors are the ones benefiting from thesearrangements. Most of them are basedhowever, in Manila. '

b. Scarcity of Farm Labor. A new breed oflabor force appears to be emerging in Malolos.The pre!erence of this new group is shiftingfrom agricultural to service and industrialwork.It is increasingly difficult to find young peopleenamored to land and farm work. Most ofthose remaining as farm labor are beginningtoget old and demanding.

C. Increasing Land Values. Malolos was notspared by the emerging urban sprawl and therelated construction boom being felt aroundthe fringes of Metro Manila. With thisdevelopment, land values have increased as aresult of actual physical development andspeculativelandbankingby investors.

d. Conversion of Nearby Areas. Conversion ofagricultural areas triggers further conversionby destroying the natural harmony of relatedland uses. In Malolos, this was manifested inthe destruction of interrelated irrigationsystems after some irrigated agricultural areashave been converted into residential use. Inthe process, ecological balance is also alteredresulting in increasing numbers of pest androdent populations.

e. Migration and Demand for Housing. Withthe increasing pace of urbanization in Manila,the demand for affordable housing becomesm?re pronounced. Market forces, drivenpnmarily by land availability. land values andhousing demand have directed the expansionof housing projects towards nearby provincessuch as Bulacan,Lagunaand Cavite.

The development of transportation andcommunications have made areas such asMalolos more accessible. This favors thegrowth of permanent migrants or those whowill choose to reside in Malolos.

f. Demand for Commercial and IndustrialAreas. The development of commercial andindustrial areas in Malolos is an inevitableresult of urbanization. The services andindustries required to support the growingresidential areas need to be located at placeswhere the population tends to agglomerate.As such. areas dedicated to commercial andindustrial activities begin to increase (althoughat a relatively slower rate) together with theresidential areas.

g. Absence at Definitive Physical FrameworkPlan. At the moment. Malolos does not havean approved Comprehensive Municipal LandUse Plan on which it can base its land useallocation. The absence of such aninstrument renders the· evaluation ofapplications for conversion rather arbitrary.

h. Development Vision ofLocal OffIcials. Thelocal officials led by the Mayor have adoptedan "open door" policy to would-be investors inland development. Although the govemmentenvisions development directed at achievingan improved quality of life for all by makingoptimal use of the available resources such astrategy virtually leaves the development ofMalolos to the mercy of market forces.

i. Ambiguity of Local Government Code.Some legal issuances. perhaps because oftheir inherent. ambiguities. appear to havehastened the rate of conversion. Section 20of the Local Govemment Code empower theLocal Govemment Units through the localSanggunian to convert, under certainconditions, a maximum of 10% of theagricultUral areas into other uses. Under thespeculative atmosphere prevailing in Malolos,this provision of the law opens a floodgate forabuse and misuse. The 10% conversionceiling, in the absence of clear implementingrules and regulations, may be interpreted asan annual ceiling, an absolute limit under acurrent land use plan, ()T a ceiling which maybe modified at every change in the localbureaucracy.

5. While there were factors that encouragedconversion, certain forces also tended tocounter the seemingly pervasive trend. Theseinclude:

LandUse ConVfJrsJon and D6VfJlopmenl Prospects

a. Lack of Alternative Livelihood for Farmers.land tillers and owners were deterred fromsuccumbing to the pressure of conversion dueto the uncertainty of securing a means oflivelihood once farming as a traditional job isaban(loned. Since most of the farmers haveattained a low level of education, theircompetitiveness in the job market isunderstandablylow.

b. Value of Land as an "Eterna/" Capital. Thefarmers regard land as a permanent asset andmeans of livelihood which can be managed inperpetuity. Most of the traditional farmershave developed deeper attachments to landand found it difficult to part with.

c. Government Polley. The existence ofgovemment policies restricting land useconversion has to some extent slowed downthe pace of the phenomenon. Moreover,govemment neglect or failure to provideservices has, in a way, saved some areas fromconversion.

d. Food Security Concerns. The concern forthe ability of a locality to feed its own peoplestill remains a factor in slowing down landconversion, particularly in a place which hastraditionally been regarded as a part of the ricegranary of luzon.

C. .land Convension Process in Malolos

.The land conversion process in Malolos largelydeVIates from the legal requirements andprocesses set by a host of legislation and executiveissuances. Even with the expressed condition thata project is subject to OAR approval. a certificationfrom the HLURB approving a housing developmentis enough to move ground. An lGU endorsementof a project has a similar effect. What is worsehowever, is that there are instances whe~developers start their project before filing thenecessary application with OAR. These modalitiestend to short-circuit a long process designedprecisely to discourage conversion (Figure 7).

37


Fig.. 7. The cooversloapl'OCeM is .MaloIos··(dgbt·ttadUdevJates· .from that maadated by law (Jefttftd).

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'SlJJJMl'fmE fOJ..LOWlNG SI1BMlT1111~J.)()(;~ DOCllMENTS rolt<.:l.tJPf't;

"'- --" " " .-..... . -. " " ----. . . , -. .e CB1t'ITFlCA 'lTl1N$AND~ 0 I OR ltlORB f!JB1I!I!1l'fC,fJ'BS OR

FROMG8J1l!RNMJINTII68NClIEN ~N'C&V Fl«JM~.

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38

D. Implications of Land Conversion to Malolos

1. Spatial Implications

The most obvious effect is the expansion ofurban areas and the shrinking of agricultural land.In the absence of a definitive municipalComprehensive Land Use Plan (CLUP), thedevelopment will tend to be sporadic. Suchdevelopment will engender premature urbanizationin some areas. Faced with this situation, plannerstend to give up 'such agricultural areas to otheruses, usually consistent with that of theneighboring development. The operative principlehere is that conversion begets conversion. Thereis an increasing danger, too, that the unregulatedconversions in the area will induce mixed landuses.

It has been observed that land useconversions are dispersed along highways andmajor roads in the town. The conversions,therefore, are bound to promote linear or ribbondevelopment. The town can expect to face trafficproblems in the future if such development remainsuncontrolled.

Such unplanned development bodes adverseenvironmental effects. Already, the informantshave experienced uncharacteristic flooding in thetown. These have been attributed to thedestruction of natural waterways.

There is also the danger of losing theamenities once associated with the town. Duringthe researchers' field visit, for instance, they werestill able to observe a flock of egrets in a rice fieldlocated between two new housing projects. Theprospect of conserving this parcel of land is bleak.and so is the opportunity to continue to observe thenature in it.

As mentioned above. the conversion is nowfocused along the main arteries which create apattern of land values that decrease as one goesaway from existing development. This situationtends - temporarily - to promote concentration ofdevelopment. There are two reasons for this: first,investors cannot acquire lands far from existingdevelopments because farmers would hold theirland since they will be offered low prices. Second,development costs in these areas tend to be higherthan the cost of land in the central businessdistricts due to the lack of infrastructure andflooding problems in the former.

Land Use Conversion and {)f)ve/opment Prospects

2. Economic Implications

The kind of development described aboveaffects social and economic sectors in differentways.

a. Local Government

On the part of the local government, this posesa concern over the cost of delivery of basicservices. Concentrated development is moreefficient and cheaper to serve in terms of basicservices (e.g.. transportation), while pocketdevelopment. because of its dispersed nature, ismore costly.

The most palpable indicator, however, that thelocal government will incur greater cost is theincreasing residential developments. This hardlypromises economic development for Malolos. Thesigns are that Malolos is fast transforming itself intoa dormitory town and housing developments haverelatively poor income potential.

More subdivisions will require additionalresponsibility since the local government will beexpected to deliver additional basic services tothese subdivisions.

Such a prospect is not along the developmentdirection desired by the Malolos LGU leadership. Itsimilarly contradicts the development direction setforth under the Metro Manila framework plan.

b. BusinessIPrivate Sector

The commercial sector definitely shall benefitfrom the current direction that the land useconversion in the town indicates. Greaterresidential development means a growingconsumer market and greater profit.

One immediate implication of land conversionis the rise in land values. In the interviewconducted with provincial agriCUlture officials. theyIndicated that some farmers were able to sell theirproperties at competitive prices: sometimes as highas P 10 million per hectare. Such trends promotethe attractiveness of a one-time windfall for thefarmers and landowners who are expecting loweredprofitability in farming.

39


C. Farm Sector

As mentioned above, land conversion has theimmediate effect of shrinking agricultural lands andraising liquidity of farmers and landowners. In effect,therefore, the new rich lose a secure "permanentcapital" and are left to the mercy of quirks in theeconomic system. In other words, the cash-hofdingllof the farmer may rise or fall in value without him doinganything.

Experience shows that investing in a newlivelihood is never a sustainable option for the farmer.Having tilled the land for a good part of his life, he willfind the transition difficult. The govemment does nothave a program of institutional support for the farmers.In the absence of assistance for developing alternativelivelihood, the farmers may bleed financially.Capability building and identification of altemativelivelihood other than agriculture-based should havebeen conducted and introduced.

The tendency to sell agriCUltural lands forconversion to other uses poses danger to the loogterm food security requirements of the town.

3. Social Impacts

The development pattern ensuing from the landuse conversions threatens to transform the age-oldsocial fabric of Malolos. As a result of the newdevelopments, the traditional neighborhood patternshall become fragmented. Once closely knitcommunities shall gradually dissolve as neighbors selloff their land to settle elsewhere. New entrants to thetown as a result of the residential developments willsurely change the traditional way of life. Attitudes andvalues of the Malolos folk are bound to be changed asinteraction takes place with the new town settlers.

The businesses attracted by the emerging marketin the town are expected to introduce values consumerism principally - hitherto foreign to themunicipality.

IX. CONCLUSIONS AND RECOMMENDATIONS

The types of development that appear to ensuefrom the land conversion actiVities occurring in Malolosappear to be in contrast to the desires of the Mal%sLGU as articulated by the Mayor. It also appears to becontradictory to the welfare ·of its constituents,particularly the farming sector. The developmentdirection Malolos is taking is therefore consistent withthe predictions or characterizations of satellite areasembodied in the dependency theory.

The researchers recommend the adoption of atwin development agenda: one internal to Malolos andanother external to it and encompassing Metro Manilaand its area of influence. This involves the formulationof Malolos' comprehensive land use plan and thepossibility of drawing up a metropolitan govemment for

40

Metro Manila and the areas affected by its internaldevelopment dynamics.

To forestall this wrong tum in its development,Malolos has to seriously consider the speedydevelopment, adoption, and willful implementation of acomprehensive land use plan that suits thecommunity's desire. The plan should feature, amongothers, a program for the farmers affected by the landconversion process. The components of such aprogram should include entrepreneurship training asan alternative livelihood.

In addition, competent authorities should seriouslystUdy the possibility of forming a metropolitan authoritythat would oversee and guide the development ofareas around Metro Manila similarly situated asMalolos. The reason is that the LGUs in MetroManila's outer core are not equipped to handle theintensity of the development impulses coming from themetropolis. Against this, even the effectiveness of acomprehensive land use plan is in doubt, But thisconstraint can be overcome if the development plansof these areas are coordinated and harmonized - muchlike the pieces of a development jigsaw puzzle - by ahigher political and administrative power, ametropolitan authority.

BIBLIOGRAPHY

Bryant, C.R., L.H. Russwurm and A.G. McLellan.The City's Counttyside. Land and ItsManagement in the Rural-Urban Fringes. NewYork: Longman, Inc.

Cabrido, Candido Jr. 1992. Implication of VariousLand Use Conversion Scenarios for Food Securityand Sustainable Development. Mimeo.

Glasscn, John. 1974. An Introduction to RegionalPlanning. London: Hutchinson and Company.

Gore, Charles. 1984. Regions in Question: Space,Development Theory and Regional Policy. NewYork: Methuen and Company.

Metro Manila Development Authority. 1996. Towardsa Humane World Class Metropolis - A PhysicalDevelopment Framework Plan for MetropolitanManila, 1996-2016. Makati: MMDA

National Economic and Development Authority. 1993.Land Use Conversion Study. A policy studyunder an AIDAB grant. Manila: NEDA

Philippine Social Science Review. 1992. Manila: UPPress

Silva, P.T. 1991. Effects on Land Use Conversion inCALABARZON - Preliminary Findings. Manila:Food and Agriculture Organization.

THE PROBLEMS AND PROSPECTS OF INDUSTRIAL GROWTH:A CASE STUDY OF THE LUISITA INDUSTRIAL PARK

Emmanuel M. Luna, Santiago R. Aquino, Jr., Aurelia R. Bathan, Angelina M.Noble, Oresentacion A. Ordas, Edgar F. Zotomayor

I. INTRODUCTION

A. Rationale

The Philippines boasts of its high economicgrowth that- is now being recognized by someeconomic research institutes as the fastest growingin Asia. This development paradigm of thePhilippines is anchored on the principles of globalcompetitiveness, liberalization, and participationand empowerment of the various sectors. Theprivate sector and foreign investments are beingmobilized to contribute towards this goal.

Regions which used to lag behind in terms ofindustrialization are being prompted to pursueindustrial development. New industrial centers suchas export processing zones, industrial estates andparks are being developed and given attractiveincentives in pursuit of this goal. Large agriculturalestates that used to contribute significantly toagricultural development are being converted toindustrial use such as the Canlubang Sugar Estatein Laguna and the Hacienda Luisita in Tarlac.

In pursuing these developments, there areforeseen and unexpected consequences, bothadvantageous and detrimental, which have to beidentified, assessed and addressed to ensure thatachieved economic growth leads to socialdevelopment. How has the establishment ofindustrial growth centers affected the communityand the lives of the people?

This study is an attempt to explore this issue.Taking the Luisita Industrial Park as a case, thestudy tries to determine the problems andprospects of industrial growth in a specific areaaffected by the industrial park.

B. Objectives of the Study

This study aims to determine and analyze theproblems and issues concomitant with theemergence of a new industrial park. Specifically,the study aims to:

1. Determine and review the policies and plansfor industrial development in Tarlac, Tarlac, thesite of the Luisita Industrial Park (LIP);

2. Determine the current development trends inthe industrial development in LIP, specificallythe profiles and direction of growth in terms of:scale and size, types of industry, location anddistribution, ownership, backward and forwardlinkages, and other attributes.

41

3. Identify and assess the problems andissues confronting these developments.

4. Determine the assessment of the localofficials and planners, workers andcommunity residents on the industrial parkin terms of the problems and issues, theresources and the impacts.

5. Suggest recommendations towards theresolution of some of the identifiedproblems and issues.

C. Methodology

This is an exploratory and descriptivecross-sectional study using the case studymethod. The Luisita Industrial Park was takenas a case because, to the knowledge of theresearchers, no study has been done yet aboutthis park. Furthermore, in the process ofidentifying a possible site, the management ofthe park showed great interest and cooperationcompared to the other sites initially consideredfor the study.

In developing the case, the researchersmade use of severa! methods of datagathering, namely:

1. Survey Among Community Residents

Two communities adjacent to the parkwere chosen as the sites for the surveywhich essenlially was concerned withdetermining the impacts of the industrialpark based on what the residents see. Atotal ol 53 residents (either the householdhead or the spouse) responded to theinterview.

2. Interview and Focused Group Discussionwith the Management of Two IndustriesBased in the Park

Two industrial establishments, Sanyo andUniversal Robina Corp. were taken assample industries from the park. Interviewsand discussions were made with themanagement of the two establishmentsfocusing on the industry's profile,locational choices, labor conditions andthe like.


3. Survey of Workers through Self-AdministeredQuestionnaire

From the two sample industrialestablishments,self-administered questionnaires weredistributed to the workers, with the assistanceof the management.Thirty respondentworkerswere identified in each establishment but only44 workers accomplishedthe questionnaire.

4. Interview with the Local Officials and Staff ofthe LIP

The local officials from the Tarlac municipalitywere interviewed concerning the developmentof the town. Similarly, the team interviewedthemanagement and the local staff of the LuisitaIndustrialPark.

5. Reviewof SecondaryMaterials

Among the materials reviewed by the researchteam were the socio-economic profile anddevelopment plan of Tartac, Tarlac and theinformation materials on the LIP and SanyoCorp.

6. Observationand Ocular Survey

The research team visited and observed thesite; the operations outside theestablishments, the interior facilities and theoperations inside the sampled establishments;the communities and the commercialestablishmentsadjacent to the industrialpark.

II. CONCEPTUALFRAMEWORK:THE SYSTEMAPPROACHIN UNDERSTANDINGDEVELOPMENT INTERVENTION

An analysis of regional structures and systemsprovides an essential starting point in theformulation of regional development intervention.Under-utilized resources of a particular region, forinstance, provide an impetus for developmentinitiatives and investments. An industrial park is atypical intervention in a region to achieve thedesired goals. Its innovation and implementationshould take into consideration the prevailingconditions in the area: the resources,the potentialsand opportunities, the development needs. theconstraints,and most of all, people's conditions.

Taking the region as the context in which theindustrial park is inputted, the pursuit of thedevelopment goals or outputs undergoes severalprocesses. These include the location of theindustry, site development, actual implementationand operations of the industrial park, and othersupport and complementing processes involvingthe social, economic, environmental and politicalfactors.

42

In the study of a development interventionwhich makes use of the systems approach, theelements composing the system such as theinput, the processes, the output and thefeedback are all considered. This is illustratedbelow:

~s,·_Aftl:I liI~"I

~,ht_iR

rJ~---.-r-___.1la::

rill l L

l.ua ...~

• lllilP"''''

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As the diagram shows, the industrial parkis the input to the municipality of Tarlac. Thedevelopment of the park undergoes severalprocesses which result in the outputs, effectsand impacts. These then serve as feedback tothe context or the prevailing socio-economic,environmental and political conditions in thecommunitiesor the municipality. The problems,issues and prospects resulting from the inputand processesare the focus of this study.

III. THE CONTEXTOF INDUSTRIALDEVELOPMENT

A. An Overview of the Socio-EconomicConditions of the Municipality of Tarlac

The town of Tarlac nestles in a plaincentrally located in the province of Tarlae. Thetown is practically equidistant from two majorcities. Manila 125 km, and Saguio 127 km. Thislocation has made Tarlac, Tarlae a stop-over ofpeople traveling north to Saguio and south toManila. The municipality is popularly known asthe "Melting Pot" of Central luzon because itsresidents speak several dialects such asTagalog, Pangasinense, llocano andPampango(Figure 2).

The physical terrain of the town isgenerally flat with hilly to mountainous regionsin the western part. The town has a total areaof 42.519 hectares. Of this. about 72% areagricultural areas while some 19% areresidential and built-up areas. The remaining9% are divided into commercial land. grazing

. and pasture land, open space, and the like.

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43

Problems and Prospects of Industrial Growth

PHILIPPINE PLANNING JOURNAL Vol. XXVIJI, NO.2 April 1997

IV. THE LUISITA INDUSTRIAL PARK: ANINTERVENTIONAND A RESPONSETOTHE DEVELOPMENTCHALLENGE

4. Industrial heartland of the Philippines withdiversified industrial structure;

5. World center for fashion and interior designrelated industries;

6. International transshiprnent hub servingSoutheast Asian countries and free seaportand airport; and,

A. Background

The Luisita Industrial Park is part of theHacienda Luisita which was acquired by theCojuangco family in 1958 (Figure 3). Thehacienda is a vast land of 6,000 hectares andcovering three (3) municipalities in the province ofTarlac: Tarlac, Concepcion, and La Paz. TheHacienda Luisita lies at a crucial corner of theNorthern Luzon Growth Triangle (LIP Materials).

B. Basic Features

The population of the municipality is 236,388according to data from the National Statistics Office.As of 1995, the growth rate increased by 2.67%. In1993, a large segment (about 85%) of the populationlived in the rural area (SEP, 1996).

B. The Industrial Development GoalThe industrial development goal of the

municipality of Tarlac is the promotion andadvancement of small and medium scale industries foroverall economic growth and stability.

The increase of industrial establishments inTarlac is high. There is also a proposed site forindustrial expansion which is along the national road.The influx of trade and commerce in Tarlac likewiseprompted foreign investors to establish industriesparticularlythose which presently operate at the LuisitaIndustrial Park.

C. The Central Luzon Development Program,1995·2010

The Central Luzon DevelopmentProgram aims toachieve a Gross Regional Domestic Product (GRDP)growth rate of 8.2% and employment of 4.095 million(up from 2.4 million in 1992). Likewise, a balancedemphasis on economic growth, environmental quality,as well as in agriculture, industry and services, andimprovedquality of life shall be targeted (CLOP, 19952010).

7. Communication center betweenpeople and other people ofbackgrounds through conference,and related service activities.

Filipinodifferenttourism

The plan identifies three National Triad GrowthCenters for Central Luzon, as follows:

1. Subic-Dinalupihan metropolitanarea

2. Angeles City-Mabalacat, San Fernandoarea

3. Malolos-MetroManila conurbationarea

The idea is to contain industrialization and highintensity urbanization in these areas so that primeagricultural lands as well as valuable coastal areas arepreserved.

An intra-regional artery is proposed in theprogram to improve the linkages between the growthcenters as well as the other provinces in the region.This consists of a new highway leading from the SubicBay area through Angeles City, La Paz in Tarlac andCabanatuan City to Palayan in Nueva Ecija. A moredirect link between Malolos and Olongapo City and astrengthened link from Malolos through San Fernandoto Angeles City is also proposed.

Ultimately, it is envisioned that Central Luzon willbe characterizedby established reputations in selectedfields (CLOP, 1995-2010):

1. World leader in people/community-baseddevelopmentactivities;

2. World center for environmenteducation;

3. Showcase of recycled-oriented rural activities andbio-diversitypreserving organic agriculture;

44

The Luisita Industrial Park is situated on 120hectares of land within Hacienda Luisita (Figure4). It is accessible through a 118-kilometeror twohour land travel from Metro Manila. It is 35kilometers or 40 rninutes from the Clark SpecialEconornicZone. Subic Bay Fireeport Zone, with itsexisting international airport/ and seaport, is justtwo hours away from the park. The Ninoy AquinoInternational Airport and the seaports of Manilaand Poro Point are also two hours away. Theindustrial park is 118 kilometers from the ManilaInternationalContainerTerminal.

The Luisita Industrial Park is supported byvarious infrastructures and facilities. For itsindustrial use water supply, the park is tapping anunderground water at 100 cubic meters per dayper hectare. Meanwhile, each locator of the parkhas its own waste water and sewerage system incompliance with Philippine law. At present, wastewater and sewerage are being treated in eachlocator's system but as soon as the proposedcentralized water treatment facility is established,the waste water and sewerage initially treated bythe locators shall be discharged into thecentralizedsystem.

The Luisita Industrial Park uses 240KVA perhectare for its power supplied by the NationalPower Corporation. Adequate telephone lineshave been provided for the park includingInternational Direct Dial facilities that could beused for data, voice and video transmission. Italso provides the locators nine (9) lines perhectare (LIP Materials).

,./


Figure 3

Figure 4

.._- j

! !

! TadaC_--._ ....k_·1IOIa

LUISITA INDUSTRIAL PARKN T S

45

PHILIPPINE PLANNING JOURNAL Vol. XXVIII, No.2 Apn11997

Deduction on necessary and majorinfrastructure works

Tax and duty-free importation ofcapital equipment

Additional deduction for laborexpenses for 5 years

Waiver of nationality requirement

Pioneer status

6-year income tax holiday (ITH)

•

•

••

•

•

developed area (LOA), companies locatingthere are entitled to several additional BOIincentives, including the following (Table 1):

C. The Advantages of Locating in LuisitaIndustrial Park

The Luisita Industrial Park 2 or the expansionarea is considered reasonably priced at P 1,700per square meter. It has an abundant Englishspeaking, educated and trainable workforce.Minimum wage in Tarlac is about 10% lower than inMetro Manila. Considering that its topography is flatterrain, no piling is required for typical one to twostorey factory structures. Its excellent internalinfrastructure and clean and abundant water arealso superior points.

Because Tarlac is classified by the Board ofInvestments (801) and the National EconomicDevelopment Authority (NEDA) as a less

Table 1. COMPARISON OF BOI INCENTIVES WITH RESPECT TO INCOME TAX HOLIDAY (ITH)AND TAX AND DUTY FREE IMPORTATION OF CAPITAL EQUIPMENT

Metro Manila CALABAR Tarlac/luisita

New Investment Priority Plan (IPP) Activity

Pioneer No incentives 6 years ITH with tax 6 years ITH with taxand duty free and duty freeimportation of capital importation of capitalequipment equipment

Non-Pioneer Filipino- No incentives 4 years ITH with tax 6 years ITH with taxOwned Companies and duty free and duty free

importation of capital importation of capitalequipment equipment

Foreign-Owned No incentives No incentives Subject to 801Companies approval. 6 years ITH

with tax and duty freeimportation of capitalequipment

New Export (Non-IPP) Activity

Foreign-Owned No incentives 4 years ITH with tax 6 years ITH with tax(exports 70% or more and duty free and duty freeof production) importation of capital importation of capital

equipment equipment

Foreign-Owned No incentives No incentives Subject to BOI(exports less than 70%) approval. 6 years ITH

with tax and duty freeimportation of capitalequipment, providedexports at least 50%

Filipino-Owned (exports No incentives 4 years ITH with tax 6 years ITH with tax50% or more of and dUty free and duty freeproduction) importation of capital importation of capital

equipment equipment

Filipino-Owned No incentives No incentives No incentives(exports less than 50%)

46

D. Profile of Industries

The 120-hectare Luisita Industrial Park isalready occupied by fourteen (14) businesses andfactories engaged in light, non-pollutingmanufacturing and service industries for domesticand foreign markets. These companies and theirnature of business are as follows:

a. Universal Robina Corp. - Terai IndustrialCorp. - manufactureof noodles andsnack foods

b. Max's Tartac, Inc. -- restaurant

c. Armstrong Realty Investment, Inc. -- leaseof warehouse buildings

d. Avantex -- manufactureof spun yarn

e. InternationalWiring System, PhilippinesCorp. - manufacture of wires and wiringfor automobiles

f. International Electric Wires Philippines,Corp. -- manufacture of low voltage wire,corrugated tubes and wiring harness

g. Jollibee Food Corp. -- food commissary

h. Luzon Apparel Corp. -- manufactureofgarments

i. Mandaue Estates, Inc. - manufacture ofhospital equipment

j. Marina Sales, Inc. - distribution of DelMonte products

k. Asian Telecommunications Products, Inc.-- manufacture of cables

I. Purefoods Corp. -- manufacture offeedmill

m. Sanyo Semiconductor ManufacturingPhilippines Corp. - assembly of LSI chips

n. Universal Food Corp. -- manufacture ofcatsup, vinegar and other sauces

About 65% of the total number of businessesand industrial locators in Luisita Industrial Park areowned by Filipinos. Avantex and Sanyo are ownedby Taiwanese and Japanese respectively. Theother businesses and industries are Filipino jointventured either with Americans or Japanese.

The establishment that occupies the largestarea is the Asian Telecommunication Products with184,639 square meters. This is followed by Avantex(157,927 sq. m) and Sanyo (80,000 sq. m). Allthese are 40-100% foreign owned. The one withthe smallest area is Max's Restaurantwith only 500square meters.

47


E. The Workforce

As of November 1996, the various locatorsof Luisita Industrial Park had a total workforceof 3,900. The biggest workforce, comprising2,600 employees or about 67% of the total areresidents of Tarlac. Five hundred seventy-one(571) employees or 15% are from the haciendawhile 729 employees or about 19% come fromother places.

Avantex has the biggest workforce comingfrom Tarlac, while Sanyo has the biggest laborpool from within the hacienda. Note howeverthat these are both foreign-ownedco~panies. '

F. Plans for Further Development

The Luisita Industrial Park is currentlyexpanding with a development area of 300hectares. The huge industrial park will besupported by an infrastructure of servicesincluding roads, power, water, security, andtelecommunications, as well as nearbyhousing, commercial and recreational facilities.

Its road development plans include the:a)extension of the North Luzon Tollway; b)rehabilitation of Route No. 3 and No. 329; and,c) upgrading of the North Luzon Expressway. Afeasibility study is currently being prepared byItochu Corp. for the extension of the NorthLuzon TOllway. If determined feasible,extension to Tarlac will be completed by late1998. Extension from Tarlac to Pangasinan willbe completed by the end of year 2000.Meanwhile, a Japanese GovernmentDevelopment Assistance loan amounting to ¥69.5 million was granted to rehabilitate RouteNo. 329 by the end of 1997. Route No.3, onthe other hand, will be completed in 1999. Forthe North Luzon Expressway, the existing twolane section between San Fernando and SantaInes, Pampanga will be upgraded to four-lanes(2 lanes per direction) by the end of 1998.

Side by side with the growth of theindustrial park is the Plaza Luisita, a modembusi.ness and commercial complex for offices,retail shops, food establishments.. andrecreational, social, and entertainmentfacilities. The plaza is geared for businesspeople and entrepreneurs who know their fieldand potential, ready to seize the opportunitiesof a huge regional market.

Through its special Ten-Year DevelopmentPlan, the Luisita envisions a world of naturalwealth gracefully fused with modern-dayfacilities and conveniences. Hence, this planincludes: low-cost and executive housing, golfand country club, a science institution, and ashopping center.


v. CASE STUDIES ON THE ESTABLISHMENTS

To have a better understanding of the otheraspects of the industrial park, two brief casestudies were done. One is on a foreign-ownedexport processing industry while the other one isFilipino-owned with a local market.

A. The Sanyo Semiconductor ManufacturingPhilippines Corp.

Background

Sanyo Semiconductor Manufacturing Corp. isa 100% Japanese company. It was established onApril 11, 1995 at the Luisita Industrial Complex.Sanyo's initial capital investment amounted to P804 million for the manufacture of semiconductorparts which are geared for the export market.Production started last September 1996. It isestimated that by the year 2000, sales will reachthe P 9 billion mark.

Reasons for Locating in LIP

It is said that the primary reason for investingin Luisita is the fact that the owners of Sanyo werepersuaded by former President Corazon C. Aquinoto locate in Luisita. The other reasons are thefol/owing:

• the presence of industrial peace

• the strategic location

• 24-h('ur electricity and security

• the availability of sufficient water

• well-paved roads and drainage facilities

• workers' good command of the Englishlanguage

• the low cost of labor

• the availability of skilled labor

The management laments that when this sitewas offered to them, there were promises that thetransport system would be improved and that theClark International Airport would becomeoperational. This has yet to be fulfil/ed.

The Personnel

As of September 1996, the company had 180workers, majority of who were engineeringgraduates from various fields and residents ofTarlac. It is worth noting that the company'sphilosophy is to hire only fresh graduates or firsttime workers. The reason for this is that they wouldlike their workers to totally imbibe Sanyo's businessethics and philosophy.

Working Conditions

Sanyo is proud that they take good care oftheir workers. The work area is clean andenvironment friendly. The workers are givensufficient time to rest and attend to their personal

48

necessities. People who have visited similaroffice buildings in Japan are quick to point outthat the Sanyo office and its premises andfacilities are comparable to those in Japan.Some of the workers are even sent to Japanfor training.

The Workers' Problems and their PerceivedChanges and Effects of the Industrial Park

Regarding problems relating to work,majority of the workers who responded to thesurvey pointed out the communication betweenthe Japanese and the Filipinos as the mainproblem. They also cited the transportationproblem in going to and from the LuisitaComplex. The park is relatively far from themain road and there is no continuous publictransport system within the park.

Majority of the respondents look at jobopportunities as the major contribution of theLuisita Industrial Park to the community.Obviously, the presence of the industrial parkin Tarlac stimulated business and employment.Residents of Tarlac were hired by companiesinside the park. Sanyo decided to givepreference to workers living in the area to showtheir commitment to the people of Tarlac.

On the effects of the industrial park on thefamily, most of the respondents said that thepark has provided financial security for thefamily.

B. The Universal Robina Corporation (URC)

Background

The URC-Tarlac is one of two satelliteplants in the northern Luzon area. Itsestablishment was part of the company'soverall strategy to penetrate as many potentialmarkets as possible. URC also maintains othersimilar plants inLibis, Quezon City; Canlubang,Laguna; Cebu, Davao and Cagayan de Oro.This strategy of "swamping" the country withURC products has made the company verycompetitive and there was a time when itsPayless chicken and beef noodles werenumber one in the market.

Instant noodles is just one of URC-Tarlac'sproduct lines. It also produces potato and cornchips. Given the huge market it serves, theplant operates in two work shifts.

The URC-Tarlac plant was established in1991, followed by the Pampanga plant in 1994.URC-Tarlac market covers the areas of NuevaEcija, Bulacan, Pangasinan, Isabela andBaguio. The Pampanga plant serves Zambalesand Bataan. In addition, two big warehousesare being maintained in Pangasinan andIsabela.

The Personnel

URC-Tarlachas a total manpower complementof 251, with almost half of them holding permanentpositions. About sixty-five percent (65%) of thecontractual employees have been with thecompany for about a year, while the rest have beenwith URC-Tarlac for at .least three years. It is arelatively young work force, eighty-five percent(85%) of which are below thirty years old. Sixty-fivepercent (65%) are receiving an average monthlysalary of P 4,000 while the rest earn between P7,000- P 8,000.

Reasons for Locating Inside the LuisitaIndustrial Park

While the company's operations weresuccessful prior to URC-Tarlac, the managementbelieved that there was still room for improvementgiven the huge untapped market in Northern Luzon.Furthermore, putting up a plant in Tarlac wouldreduce transport costs of major raw materials suchas com and potatoes that come from Baguio andother northern provinces. In addition, the provinceof Tarlac, as well as the neighboring provinces,could provide URC with a pool of cheap and highlyskilled labor. These would be consistent with theobjective of maximizingthe company's profit.

The LIP provides safety to both URC's physicaland human resources. Unlike in one of theproduction sites in Mindanao which has beenreceiving requests for protection money, URCTarlac provides peace and security essential for thecompany's smooth operations.

Problems Identified by URC·Tariac Workers

In a survey conducted among the workers ofURC-Tarlac, they complained about the inadequatetransportation facilities within the park. The influx ofvarious firms inside the LIP has resulted in anacute shortage of transportation facilities for theworkers of all the firms. The working environmentinside the plant has insufficient ventilation resultingin high humidity and irritating odor from the stocksof raw materials.

Observed Changes in the Community

The workers were one in saying that theestablishment of the various firms inside the LIPhas brought more job opportunities for Tarlac andthe surrounding provinces. This has considerablyreduced the number of idle hands, specificallyamong high school graduates. Neighboringcommunities became lodging places for thousandsof immigrant workers. Homemakers began putting

49

Problemsand Prospectsof IndustrialGrowth

up variety stores to serve the needs of theincreasing number of workers. No doubt, thesedevelopments have brought additional incometo families and made them more financiallystable.

VI. THE OUTCOME: THE PEOPLE'S VIEWON THE IMPACTS OF THE INDUSTRIALPARK ON THE COMMUNITY

When an industrial park like the LuisitaIndustrial park in Tarlac rises adjacent tocommunities whose economy is primarilydriven by agriculture, how does it affect thepeople and their communities in general? Toprovide the answer to this question, a surveywas conducted in Barangay Malaya andParaiso, two communities close to theindustrial park.

Fifty-three people responded to thesurvey. The interview focused on three mainconcerns, namely: 1) the characteristics of therespondents and their family members; 2) thepreference for the absence or presence of thepark; and 3) the impact of the industrialdevelopmenton their community.

A. The Respondents

Most of the respondents come fromrelatively small families, with about 68% ofthem belonging to families with six membersand below. Half of them have been settled inthe barangay for more than three decades.About two out of five chose to stay in thecommunity because they were born there - asign of deep affiliation to one's hometown. Onthe other hand, 15% are uncertain why theychose to stay.

A quarter of the respondents say that thetotal monthly income of the family is between P3,000 to P 6,000. Quite surprisingly, a numberof respondents (23%) do not have any idea asto how much their family monthly income is,hinting that it is probably not steady. Majority ofthe family members belong to the workingclass, though the number of those who belongto the non-working group is not far behind.Almost all the family members, when asked todescribe their occupation, belong to nonprofessional groups. This could indicate theirlimitation in educational attainment.

Roughly 82% of the family members saythey are young. If we consider age 45 to be thelimit of youthfulness. half of them (age 17-45)may be perceived to be behind the economicdriving force of the community.


disappointing 75% were indifferent to sharing.Some (13%) called for open communication.

VII. THE FEEDBACK: AN INTEGRATEDANALYSIS OF THE PROBLEMS, ISSUESAND PROSPECTS FOR INDUSTRIALDEVELOPMENT IN TARLAC, TARLAC

This section presents an integratedanalysis of the study, focusing on theproblems, issues and prospects identifiedthrough the various data gatheringmethodologies.

A. The Industrial Park has Contributed toEmployment Generation

There was a consensus among all thesources that the industrial park had contributedto employment generation in the municipalityand the province. The industries prioritizedhiring the local residents. The communitypeople and the workers themselves attest thatthe number of by-standers has decreased.High school graduates were given the chanceto work.

If the type of employment will beassessed, one can easily see that it is mostlynon-professional in nature (e.g., factoryworkers). At the same time, the salary levelwithin the park is essentially the same asoutside. This means that the industrial park hasnot created an impact on the wage scalestructure. The minimum wage as mandated bylaw is the one enforced. The establishment hasprerogatives to give higher wages to theworkers, but this was not seen in the study.This shows that the law of labor supply anddemand is the prevailing principle operating inthe area. In the first place, the industriessettled in the park precisely because they seethe advantage of skilled cheap labor.

The more established and foreign-ownedcorporation (Sanyo) is able to provide betteramenities, including training in Japan, butthese are limited to the professional, technicaland management staff.

It can be observed also that theemployment generated in the highlytechnological firm is smaller compared to thelocal industry.

B. The Industrial Park has Contributed tothe Physical Improvement of the Area

There was an overwhelming preference forthe industrial park. In addition to the economicbenefits, the residents cited the physicalimprovement as one of the significantoutcomes. The residents describe the place asformerly full of sugar cane or grass with snakesSUddenly crossing the unpaved dirt roads.Now, the residents appreciate the concrete

7

5

3

3

2

1

1

42

14

12

4

6

3

3

2

1

36

12

10

1. More employment

2. Economicimprovement

3. Populationincrease

4. MoreInfrastructure &physicalimprovement

5. Improved peaceand order

6. Establishment ofmalls

7. More pollution

8. More apartmentsbuilt

9. Improved waterservice

B. The Impacts of the Industrial Park

It is seen that among the working familymembers of the respondents, about 60% areworking outside the industrial park, and theremaining 40% within the park. This is a concreteindication that there is employment opportunityinside. However, close to half of the members whosay they work outside cannot determine how muchthey earn, a clear indication of income instability.For those who claim to be working inside theindustrial park, just a little over 50% say they earnbelow P 50,000 annually. Furthermore, there isbarely any difference in the number of respondentswho earn more than P 4,000 monthly, whether theywork inside or outside; except in the P 8,001-P10,000 category. This means that while theindustrial park has created more employment, ithas not affected the wage level among the workingclass.

As to perceived changes and effects of theindustrial park, the respondents cited the follOWing:

Changesand Effects Frequency Percentage

10. Increasedexpenditure dueto mall

11. No changes 8 9

In addition, an overwhelming 89% say thatthey prefer the industrial park. A majority (62%)prefer to have the industrial development becauseof the employment.

When asked about the problems encounteredin the community, 28% of the respondents say thatthere is no problem. However, 19% complain of toomany people on too little space. When requestedto provide solutions to the problems encountered, a

50

roads as well as the mushrooming of commercialestablishments, including the mall. The physicalimprovement has somehow instilled a sense ofpride and hope to the residents that they can soonenjoy the comfort of good living without going toother areas.

C. There is an Emerging New Lifestyle Amongthe Residents

One of the effects cited by the people is theincreased expenditure brought about by theemergence of the commercial establishments.They now have Jollibee, Max's Restaurant , andthe Luisita mall. In the immediate future, the LIPwill make the Luisita Golf Club more popular andopen to the public.

The people in the area have the right to allthese comforts and services. This will not be aproblem to those who have the money and whosepattern of thinking has been urbanized. However,for those who are struggling in securing an incomeand whose values are still feudal, the newdevelopment can be oppressive. The socioeconomic gap will widen and will become veryvisible. It can lead either to continuing frustrationsto become "in" or to rebellion and anger because ofthis increasing socio-economic differentiation.

Thus, consumerism is on in Luisita and Tarlac.For the industrialists and investors, this is anopportunity. For the middle income people, it is aprice and a source of hope, comfort and pride. Forthe poor, it can be agonizing.

D. The Conversion of Agricultural Land isSwiftly Taking Place

There can be land that can be devoted forindustrial use only if the agricultural land will beconverted. The Luisita Industrial Park wasestablished prior to the passage of the LandReform Law and other rules concerning landconversion. In this light, there is no legalimpediment. In fact, it can even be thought of thatthe park was planned out to evade the thenforthcoming land reform law.

As former sugar land, the conversion is seenas very rational, economically speaking. The priceof sugar is very discouraging. Maintaining the landfor sugar could mean great losses while sellingthem for industrial use is a thousand times morerewarding.

E. The Urbanization Brought About by theIndustrial Development Brought with it NewSocial Problems

The population in the area increased. Thereare many reasons for this which relate to theindustrial development. First, although it was ageneral guideline or policy of the establishment tohire local labor, not all skills can be providedlocally. Second, the management group is normally

51


from the mother company and they have tomove to Tarlac. Third, even if the new settlersare not working inside Luisita, many peopleprefer to stay in the place because of thecurrent and speculated developments.

With the increase in population, traffic hasbecome obvious among the residents. Ofcourse, the external factor to this is the factthat the highway became the new route forBaguio since the lahar disaster.

Concomitant with the increase inpopulation are the other problems such ascongestion, increase in the price of goods,housing and land, pollution, and the like.

F. The Developments Cause GreatPressure to the Municipality inResponding to the Needs of itsConstituents

While it is true that the development isgood for the municipality in terms of income,population (the larger the population, thegreater the IRA of the local government),popularity, etc., it is also causing a lot ofpressure in terms of responding to the variousneeds of its constituency. Additional socialservices have to be put in place. More socialproblems need to be attended to. However,these serve more as challenges rather than.constraints to development.

G. The Luisita Industrial Park Contributesto the Achievement of the Goals andObjectives

The LIP is a private venture. However, inthe process of developing it, the LIPsignificantly contributes to the industrialdevelopment goals of the municipality. Theplan to transform the town into a city is beingenhanced by the developments taking place inthe park. The municipality's plan to develop anindustrial center along the highway is verymuch in line with the plan of the LIP.Functionally and personally, good relationsexist since the owners of the LIP are related tothe local officials.

H. The Industrial Development in TarlacCan Serve as a Countermagnet forOther Regional Centers in CentralLuzon

In Central Luzon, the growth centers beingdeveloped are the Subic area, Angeles-SanFernando area, and Malolos. The developmentof the industrial park in Tarlac can boost themunicipalitv's quest to be a regional growthcenter as well. For the region and for MetroManila, this will be very advantageous in termsof enhancing inter- and intra-regional balance.Metro Manila will have a countermagnet inTarlac itself. The mere fact that there was a

PHILIPPINE PLANNING JOURNAL Vol. XXV/lJ, No. 2 Apri/1997

significant increment in the population in Tarlac inthe past years shows that it is able to maintain itspopulation from getting out. and even receivingimmigrants from other places.

I. The Local Industries have Greater ValueAdded and Linkages than the ExportProcessing Industries

Based on the two companies studied, thefindings indicate that the local industry has greaterforward and backward linkages than the exportprocessing industry. The former can contributemore to the local and natlonal economy in terms ofemployment, taxes, and production. In terms ofemployment, the local industry, because it is not ashighly technological than the foreign basedindustry, is able to hire more workers. However,they are not given as much tax incentives as theexport processing firms. In terms of productivity,the value of production of the export processingindustry may be bigger, but the local industry isable to trigger more backward and forwardproduction. It uses local agricultural andmanufacturing inputs and market its productslocally.

J. Within the Industrial Park, There are SomeNeeds that Have to be Addressed

The workers were very strong in theirsentiment that they need additional transportfacilities within the park. There are buses duringshift hours like 6:00 AM, 2:00 PM, and 10:00 PM.After these hours, the workers or other residentsand guests have to walk going in and out of thepark. What they need is a continuoustransportation service.

Related to this issue is the need to improve theroad network outside the facility as well as the longawaited operation of the international airport inClark.

The management has to bring up the case ofpollution and the sewage of some locators that arebeing channeled into the sewerage system of thepark. The arrangement was that each enterpriseshall provide its own sewerage treatment.

VIII. RECOMMENDATIONS

It is recognized that this research, beingexploratory in nature, is not enough to provide averi comprehensive situation of the industrial park.However, it generates the following preliminaryrecommendations that can be subjected to furtherstudy and analysis:

1. The plan to hasten the development of thepark to the point that it can create an elitistatmosphere within, like devoting much land forthe golf club, has to be reviewed. This seemsvery inappropriate and inequitable since many

52

resources, even if these are privatelyowned, are being developed for the use ofthe very few.

2. There have been many industrial estatesand industrial parks operating in thecountry and the LIP does not differ interms of orientation or purpose. What isneeded now is an experiment in attractinglocal industries which may not be very big,but have the potential for growth and cancontribute more to the local economy. It islike helping the needy industries grow.What is happening now is the opposite.The bigger and more stable industries arethe ones getting the greater incentives andsupport.

3. In exchange for the kind of support thatcan be provided by the park, the industriallocators will be asked to give betterworking conditions and minimum salaryscale for the workers. In this way, theindustrial park becomes an instrument foreconomic development as well as socialtransformation.

4. The management of the industrial park hasto respond to the needs expressed by theworkers, particularly the transportationfacilities. The sewerage and pollutionproblems also have to be monitored andgiven corresponding action.

5. For the local government, the planning ofservices should take into account theprojected population and their demand forservices in the coming years. Theestablishment of the industrial park is a bigfactor for growth and it is causing a lot ofchange which the local government shouldseriously address.

6. The workers should learn to organizethemselves because this is their right. Theindustrial peace is one of the reasons thefirms located in the park but it does notmean that the presence of labor unionswould lead to the decline of this peace.

BIBLIOGRAPHY

Central Luzon Development Program (19952010)

Luisita Industrial Park Information Materials

Sanyo Company Profile

Socio-Economic Profile of Tarlac, 1996

· ABOUT THE CONTRIBUTORS

MA. HAEZEL M. BARBER is a registeredEnvironmental Planner and currently aSenior Officer of the Land Use andPhysical Planning Coordination Divisionof the Regional DevelopmentCoordination Staff (RDCS) at theNational Economic and DevelopmentAuthority (NEDA). She has extensivelyparticipated in various environmentaland land use related fora. She obtainedthe Bachelor of Science degree inArchitecture at the University of Sto.Tomas and Master of Arts in Urban andRegional Planning degree at theUniversity of the Philippines.

Term Papers prepared for Planning 220(Regional Planning Theory andPractice) under Prof. Cynthia D.Turingan

Administration

BENJAMIN V. CARINO, B.A. (P.A.) MA (Political Science), Ph.D. (Political Science), Dean

UTA S. VELMONTE, B.S. (Social Work), Diploma in Urban Studies, Sectetary

ROSARIO D. JIMENEZ, A.B. (History), Diploma in Comprehensive Regional Development Planning, MA(URP), Director ofGraduate Studies

DOLORES A. ENDRIGA, A.B. (Psychology), MA (Sociology). M.RP., Director ofResearch andPublications

CYNTHIA D. TURINGAN, BA (PA), Diploma in Comprehensive Regional Development Planning,Director of Training

MINERVA B. VERGEL DE DIOS, A.C.S., B.S.C (Management), Administrative Officer

Faculty

(Political JAIME U. NIERRAS, B.S. (Architecture), M.S.Surveys, (Urban Planning), M.S. (Tranpoltation

Planning, AssociateProfessor

NORMAN R. RAMOS. BA(Economics), MA(Economics), Ph.D. (Management),Associate Professor

MARQUEZA C.L. REYES, B.S. (Geology), MA(Urban and Regional Planning), AssistantProfessor

ASTEYA M. SANTIAGO, U.B. (cum laude).M.T.C.P., certificate in GovernmentManagement, Ph.D. (Architecture), Professor

ERNESTO M. SEROTE, A.B. (English), Diplomain Integrated Surveys, M.U.RP., Master inUrban Studies, Associate Professor

FEDERICO B. SILAO, A.B. (Political Science),M.P.A.• Professor

CYNTHIA D. TURINGAN, B.A. (P.A.), Diploma inComprehensive Regional DevelopmentPlanning. AssociateProfessor

lITA S. VElMONTE. B.S. (Social Work). Diplomain Urban Studies. Associate Professor

OlEGARIO G. VlLLORIA, JR. B.S. (IndustrialEngineering). M.S. (Civil Engineering. TrafficEngineering), Ph.D. (Civil Engineering.Transportation Planning). AssociateProfessor

DAVID LEONIDES T. YAP. B.S. (Architecture).M.A. (Architecture). Ph.D. (Science of ArtandDesign). Associate Professor

ALEX RAMON Q. CABANILLA. A.B.Science). Diploma in IntegratedM.U.RP.• Assistant Professor

CANDIDO A. CABRIDO. JR.. B.S. (MedicalTechnology/Biology). M.S. (Biology). Diploma& M.S. (Environmental Engineering). Ph.D.(Environmental Science), AssociateProfessor

PRIMITIVO C. CAL, B.S.C.E., M. Eng.(Transportation Engineering). Ph.D.(Transportation Planning). Ll.B.• Professor

BENJAMIN V. CARINO, B.A. (P.A.) M.A. (PoliticalSCience).Ph.D. (Political Science). Profess( r

DOLORES A. ENDRIGA. A.B. (Psychology), M.A.(Sociology), M.R.P.• Professor

MANUEL L JAVIER, B.S. (Education), MA(Education Administration), M.A. (Urban andRegional Planning), AssociateProfessor

ROSARIO D. JIMENEZ, A.B. (History), Diploma inComprehensive Regional DevelopmentPlanning, MA (URP). AssociateProfessor

HUSSEIN S. L1DASAN. B.A. (Economics.).Certificate in Development Economics, M.(Environmental Sciences, Ph.D. (Urban andRegional Planning), AssociateProfessor

ROQUE A. MAGNO, B.S. (G.E.), M.T.C.P.•AssociateProfessor

ZENAIDA A. MANALO, A.B. (Economics).certificate in Special Program in Urban andRegional Studies (SPURS). M.A. (URP).Ph.D. (URP). Associate Professor

Research Staff

DELIA R ALCALDE, A.B. (Sociology). University SUZANNE M. NAZAL, B.A. (Social Work), MAResearcher 1/ (Urban and Regional Planning). University

CARMElITA RE.U. L1WAG, A.B. (Political Research AssociateScience). MA (URP). M.R.R.P., University lEO AlVAREZ URRUTIA. B.A. (Humanities).Researcher/ University Research Associate

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PHILIPPINE PLANNING .a·c·,· JOURNAL XXVIII, No. 2... · comprises the provinces of Cavite,...

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