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EXECUTIVE ORDERS
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EXECUTIVE ORDER NO. 976 - PROVIDING
FOR AN EXPANDED YELLOW CORN PRODUCTION ASSISTANCE PROGRAM AND FOR OTHER
PURPOSES
WHEREAS, under the New Republic, national
development shall be pursued with renewed dedication and greater
determination through a more efficient, effective, and economical
government;
WHEREAS, the increased production of yellow corn has become of even
critical importance to the country, both in terms of reducing if not
eliminating present imports of over $150 million of feed grains
annually for animal feed requirements, as well as for the generation of
exports;
WHEREAS, the existing program for corn production may still be improved
upon by way of extending financial and other incentives to those who
convert agricultural land presently used for other purposes to yellow
corn production, especially excess or marginal sugar lands;
WHEREAS, it is desirable to utilize a gradual approach involving the
various incentive options, initially to a limited number of provinces
without prejudice to the eventual expansion of coverage;
WHEREAS, a successful expanded yellow corn production involving the
various incentive options, initially to a production of similar crops
such as soy beans, in order that self-sufficiency in animal feed
requirements may be ultimately achieved; and
WHEREAS, under Presidential Decree No. 1416 as amended, the President
is empowered to undertake such organizational and related improvements
as may be appropriate in the light of changing circumstances and new
developments;
NOW, THEREFORE, I, FERDINAND E. MARCOS, President of the Philippines,
by virtue of the powers vested in me by the Constitution and the
authority vested in me by Presidential Decree No. 1416 as amended, do
hereby order and ordain:
Section 1.
Sec. 2.
There is hereby established a Yellow Corn Fund, which shall be a
revolving loan fund, and which shall be used to augment the financial
resources required for the expansion of the yellow corn production
program, in accordance with the alternative approaches indicated
hereunder. The Fund shall continue to be used for the purposes for
which it is herein established, until such time as it may be deemed no
longer necessary for such purposes as determined by the President, upon
the recommendation of the National Food and Agriculture Council.
Upon recommendation of the National Food and Agriculture Council, the
President may extend the coverage of the expanded yellow corn
production program and the availability of the Yellow Corn Fund to such
other animal feed and food grains as may be deemed desirable and in the
national interest.
Sec. 3.
The Minister of Agriculture and Food as NFAC Chairman shall oversee and
coordinate the implementation of the program, as well as establish and
execute, where called for, the necessary supportive policies and
sub-programs when the Council itself is not in session. With the
approval of the President, the Minister of Agriculture and Food shall
determine the allocation of available monies of the Yellow Corn Fund
for distribution among the various selected participating provinces.
At the provincial level, the Provincial Agricultural Officer shall be
responsible for coordinating and monitoring the progress of the various
assistance options of the expanded yellow corn production program,
including the compilation of the appropriate statistics and the
evaluation of the alternative programs.
Sec. 4.
There will be three major options or conduits for availing of
assistance from the Yellow Corn Fund, as follows: (a) those under, the
institutional end users and suppliers assistance program, (b) those
under the National Food Authority assistance program, and (c) those
under the banking system assistance program.
NFAC shall prepare coordinated and consistent general guidelines for
the three conduit programs; provided, that adequate safeguards shall be
provided against duplicative financing for the same yellow corn
production venture, although the use of various modes of financial
assistance for different aspects of the same production venture may be
considered; provided, further, that the relative implicit and explicit
financial incentives offered under each alternative conduit program
shall be as equal as possible, so that any subsequent assessment of the
relative efficacy of the various approaches shall not have been
affected by unequal financial incentives; provided, further, that the
implementing agencies for the three conduit programs as well as the
industry representatives concerned shall have been consulted; and
provided, finally, that the incentives formulated for the expanded
yellow corn and production program shall also be applicable for the
existing Masagana programs.
Sec. 5.
The extension of credit from the Fund shall be to the participating end
users/suppliers, which may have undertaken extensions of credit to the
appropriate farmers, The repayment of loans made to the end
users/suppliers from the Fund shall be the responsibility of the end
users/suppliers, and shall not be dependent in turn upon their
efficiency of collections from the farmers.
The NFAC guidelines shall indicate, among others, the permissible forms
of contracts between end users/suppliers and farmers, for purposes of
access to the Fund. Participating institutional end users and input
suppliers shall be required to present supporting documentation as
evidence of direct assistance to qualified farmers before they can
avail of the Fund.
Among other possible arrangements, institutional end users may adopt
the “forward selling” method where a contract shall be signed between
the farmer and the local institutional end user stating among others
that the former’s produce shall be sold to the latter at an agreed
price, with the latter providing initial payments or actual input
material at planting time, for such items as seeds, fertilizer and
chemicals, union the balance payable upon delivery of the contracted
volume.
Local private input suppliers, either directly or through their local
distributors or dealers, may sell agricultural inputs to qualified
farmers on credit payable at harvest time or at some other mutually
satisfactory time.
For purposes of this Executive Order, the term “institutional end
users” shall refer to enterprises which purchase yellow corn from
farmers for the purpose of further physical processing or for
packaging, such as for feed or for cornstarch production; however,
traders and consumers by themselves are not institutional end users,
this sense. The term “input supplier” shall refer to enterprises which
sell inputs for the production of yellow corn to farmers, such as
fertilizer, hybrid seeds, pesticides and other chemicals. In both
cases, NFAC may determine the possible necessity of prior certification
of participants by the appropriate government entity.
The NFAC Chairman, in consultation with the Central Bank and the Bureau
of the Treasury, shall determine the manner by which availment from the
fund shall be released to the end users/suppliers.
Sec. 6.
NFA is hereby authorized to likewise extend to farmers and other
appropriate private sector entities other forms of appropriate storage,
marketing, and distribution assistance through the utilization of its
physical facilities for storage, transport, and communications
purposes, as may be necessary and under such terms and conditions as
may be formulated by NFA.
NFA may also engage in the procurement and distribution, either through
its own outlets or through such other appropriate outlets as it may
determine, of agricultural input materials for the production of
yellow, corn, such as certified seed, fertilizer and the like, in
consultation with the appropriate private sector industry
representatives concerned; provided, that any such distribution and
sale to farmers as may undertaken on credit terms shall be limited to
NFA farmer passbook holders, and under such reasonable financial terms
and conditions as may be formulated by NFA.
In the implementation of these programs, NFA is hereby authorized to
participate in the availment and utilization of the Yellow Corn Fund.
The NFAC Chairman, in consultation with NFA, the Central Bank, and the
Bureau of the Treasury shall determine the manner by which availment
from the Fund shall be released to the NFA.
Sec. 7.
Unless otherwise modified by the Monetary Board, the existing Masagana
lending guidelines shall continue to govern the credit operations under
this program. However, the participating lending banks are hereby
enlarged to include not only the rural banks and the government banks
such as the Philippine National Bank, but also such qualified
commercial banks and thrift banks as may be determined by the Monetary
Board.
The Monetary Board may issue such additional or amendatory rules and
regulations governing the qualification of banks which can participate
in the program, procedural mechanics of the release of funds to these
banks, the responsibility of these participating financial
institutions, and the provision for an effective monitoring system to
amend, complement or supplement the said existing guidelines; provided,
that in the formulation of such rules the Monetary Board shall be
guided by the objectives of the program, which is to accelerate the
production of yellow corn, through simple, expedient, and financially
reasonable operating policies to facilitate the endeavors of the
intended farmer/borrowers.
Sec. 8.
Sec. 9.
Sec. 10.
Sec. 11.
Sec. 12.
Sec. 13.
Done in the City of Manila, the
1st day of August, in the year of Our Lord, nineteen hundred and
eighty-four.
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