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LETTER OF INSTRUCTIONS
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LETTER OF INSTRUCTIONS NO. 857 |
Philippine Coconut Authority
WHEREAS, in 1973, the drastic price increases in crude oil precipitated by the Organization of Petroleum Exporting Countries (OPEC) unleashed an unprecedented worldwide inflation;
WHEREAS, to cushion the impact of the spiralling costs of essential coconut-based consumer products on the consumers, the coconut farmers volunteered to subsidize the manufacture and processing of these products;
WHEREAS, since then, the OPEC has demanded and implemented continuous hikes in crude oil prices, precipitating a further escalation of prices of other commodities;
WHEREAS, since the coconut farmers themselves bear the burden brought about by the worldwide inflationary spiral, the funds appropriated for the subsidy should now be made to serve a dual purpose, namely:
a)
To insure the continuous and adequate supply of essential coconut-based
products for the benefit of the consumers; and
b) To insure
that the impact of the worldwide inflationary spiral on the coconut
farmers is likewise cushioned.
WHEREAS, any savings in the subsidy fund should thus be channeled into developmental projects for the benefit of the coconut farmers, particularly those which could assure them of higher farmgate copra prices;
WHEREAS, one of the reasons for low farm-gate prices is the excessive number of middlemen participating in the multi-staged channel through which the copra produced by the coconut farmers is purchased and ultimately sold to end-users of copra;
WHEREAS, with the necessary financial support, the COCOFED and its 950 municipal chapters could establish cooperative copra collecting centers which can be engaged in the direct purchase of copra from the coconut farmers and the direct sale of copra to such end-users which the coconut farmers themselves own or control through the Coconut Industry Investment Fund, thereby eliminating the need for multiple copra middlemen;
WHEREAS, with the reduction of the number of middlemen, the speculative profits that would otherwise be reaped by them could be shared by both the coconut farmers and consumers in the form of higher farm-gate prices of copra and, at the same time, more reasonable prices of essential coconut-based products;
WHEREAS, there is a need to provide additional funds for:
a)
The acquisition of refineries and additional oil mills by the coconut
farmers, in order that the objective of the vertical integration of the
coconut industry in a manner making the coconut farmers direct
participants and beneficiaries thereof may be attained within the
shortest possible time; and
b) The social
amelioration program for coconut farmers, in order to further promote
the direct personal well-being of the coconut farmers and that of their
families.
NOW, THEREFORE, I, FERDINAND E. MARCOS, President and Prime Minister of the Philippines, by virtue of the powers vested in me by law, hereby direct the Governing Board of the Philippine Coconut Authority (PCA) to implement the following:
1.
Any portion of the amount allocated out of the Coconut Consumers
Stabilization Fund (CCSF) levy for the subsidy of essential
coconut-based consumer products which may not be needed for the purpose
shall be allocated ratably for the following purposes:
25%
— to augment the Coconut Industry Investment
Fund (CIIF), to be used to finance the establishment
and operation of industries and commercial
activities
relating to the coconut and other palm oil industry,
as prescribed by Article III, Sec. 9, of P.D.
1468.
40%
— As additional fund for the social amelioration of
the
coconut farmers in the form of mutual assistance,
protection and relief, such as for insurance, and
for
providing health facilities and services, as
prescribed
by Article III, Sec. 2(e), of P.D. 1468.
35%
— As the Copra Price Stabilization Fund (CPSF).
a)
To minimize the present intervention of multiple copra middlemen and
thereby achieve a more efficient and non-speculative marketing of the
copra from the coconut farmers to the end-users such as the oil mills,
refineries and copra exporters, the COCOFED and its chapters shall
organize and operate cooperative centers which will collect the coconut
products directly from the farmers.
b) The CPSF
shall be administered for the coconut farmers by a Committee composed
of three (3) members, one (1) of whom shall be designated by the PCA,
on (1) by the COCOFED, and one (1) by the administrator of the CIIF.
The members shall elect from among themselves the Chairman of the
Committee.
c) The funds
of the CPSF shall be utilized initially to finance the capital
expenditures necessary to establish and operate the COCOFED cooperative
collecting centers. Thereafter the CPSF and the profits derived from
the operations of the COCOFED cooperative collecting centers shall be
returned, if feasible and practicable, as patronage dividends to the
coconut farmers who may be entitled thereto as determined by the CPSF
Committee, such patronage dividends for each individual recipient to be
computed on the basis of copra sold by such recipient, and the
patronage dividends shall be paid directly to the farmers concerned at
such times as may be conveniently done and as determined by the CPSF
Committee.
d) The copra
supported by the CPSF shall be sold to end-users owned or controlled by
the coconut farmers thru the CIIF.
e) To insure
the effective implementation and continued viability of the operations
of the COCOFED cooperative collecting centers, the PCA may, from time
to time, with the concurrence of the COCOFED and the administrator of
the CIIF, adjust the ratio of allocation provided in paragraph 1 above
or make the necessary reallocation.
Done in the City of Manila, this 4th day of May, in the year of Our Lord, nineteen hundred and seventy-nine.
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