Manila: The Department of Agriculture (DA) on Friday unveiled the Philippine Sustainable Agriculture Transformation (PSAT) program, a significant initiative financed by a USD1-billion package from the World Bank (WB). This groundbreaking program aims to modernize the agriculture sector in the Philippines, enhance productivity, and bolster food security across the nation.
According to Philippines News Agency, the PSAT program represents the Philippines' inaugural project under the World Bank's Program-for-Results model. This financing approach is distinguished by its focus on releasing funds based on measurable outcomes rather than upfront disbursements. The project reflects confidence in the DA's reform agenda and signals a shift towards results-oriented development financing.
"This financing allows us to raise farm productivity, stabilize food supply, and protect millions of livelihoods dependent on agriculture. By strengthening value chains and building climate resilience, we are supporting rural incomes and reinforcing a key pillar of the economy," stated Agriculture Secretary Francisco Tiu Laurel Jr. during the launch event.
The PSAT program is focused on achieving three primary outcomes: increasing rice-based farming output, enhancing efficiency and climate resilience in value chains, and improving institutional performance. By connecting farm productivity with supply chain upgrades and governance reforms, PSAT aims to deliver comprehensive and measurable results across the entire agricultural value chain.
A notable aspect of the initiative is its use of disbursement-linked indicators, which mandate that the government meet specific verifiable targets before accessing funds. While this may initially slow down disbursements, it ensures accountability and fosters an outcome-driven execution process. The government expects a preliminary release of USD300 million in 2026, providing critical fiscal support amid current energy and climate-related challenges.
"These programs will help at least five million farmers diversify livelihoods, increase income, and manage climate risks. Rural communities will benefit from modernized services, stronger value chains, and a more resilient food system," remarked WB Philippines, Malaysia, and Brunei Division Director Zafer Mustafaoglu.
Accompanying the loan is a USD24.5 million Technical Assistance for Sustainable Agriculture Transformation (TASAT) grant, which includes a USD14.5 million contribution from the UK through its Just Rural Transition Support Programme. This underscores a dual strategy of large-scale investment coupled with capacity building.
"This portion is focused on transforming our agricultural practices towards sustainability with key priorities such as sustainable farm practices, soil health, water conservation, ecosystem services, and the adoption of low-carbon rice practices alongside sustainable fertilizer use," explained DA Assistant Secretary for Special Concerns and Official Development Assistance Arnel de Mesa.
He emphasized that the TASAT grant reinforces the agricultural system's backbone and supports the design and implementation of systems promoting climate-smart agriculture. Additionally, the initiative looks to repurpose the fertilizer subsidy program and boost diversification and export development.
British Ambassador Sarah Hulton highlighted the critical intersection of agriculture with climate change, food security, and economic growth, stressing the urgency of transformative action. "Agriculture sits at the crossroads of climate change, food security, and economic growth. As farmers face stronger typhoons, floods, and disrupted supply chains, transforming agriculture is not just a technical task; it is a strategic necessity. That is why the UK, together with the World Bank, is investing in TASAT to raise incomes, stabilize food supplies, and strengthen climate resilience while protecting land and nature," she noted.
