CAPÍTULO IV DESARROLLO DEL PROYECTO
4.6. Análisis estático no lineal pushover
The Alter Trade Group (Alter Trade) began as an initiative between Filipino and Japanese social activists in the 1980s. It grew out of a ‘Trade not Aid’ or people-to- people trade concept amidst a sugar crisis that hit the Island of Negros in the central Philippines in the mid-1980s.
Alter Trade’s main products were organic muscovado or unrefined brown sugar, and naturally grown native bananas of the Balangon variety. For the most part of their existence, they had exported these products to partners mainly in Japan and Europe.
Alter Trade’s primary stakeholders were backyard producers of naturally grown Balangon bananas among indigenous and upland communities in various parts of the country, and former landless sugar plantation workers in Negros Occidental province. The latter were beneficiaries of the government’s land reform program and were assisted by Alter Trade to become farmer-partners producing organic sugar cane. Before Alter Trade’s intervention, muscovado sugar was no longer being produced in large quantities in the province, and Balangon bananas did not have commercial value in Negros Island or elsewhere in the country.
In 1993, Alter Trade became a member of the International Federation of Alternative Trade (IFAT), now the World Fair Trade Organization (WFTO). These fair trade organizations (FTOs) provided marginalized producers sustained access to global markets. These FTOs also enabled the marginalized producers to be part of their own development. FTOs in the Philippines adhered to international Fair Trade Standards that had been codified into 76 indicators adapted to Philippine conditions (Advocate of Philippine Fair Trade, Inc. (APFTI), 2005). The standards included the provision of fair prices to producers, fair wages to workers, production pre-financing, prompt payment of deliveries, and an assurance of a long term relationship (Gomez, 2004).
Among the 20 major fair trade organizations (FTOs) in the Philippines, Alter Trade Group was recognized by leaders of the Philippine fair trade movement as the biggest in terms of sales (reaching PhP 200.7 million in 2008) and outreach among poverty sectors served (820 sugar farmers and 3,493 banana growers as of end 2007). It was one of two Philippine FTOs carrying Fair Trade Labeling Organizations
International (FLO)15 certification (Agustin, 2008; Lagazo, 2008; David, 2008).
Alter Trade was also considered by the big players within the sugar industry as “the market leader in terms of volume and quality of product in the muscovado subsector” (Bennet, 2008). Department of Trade and Industry officials affirmed this:
15Fairtrade Labeling Organizations (FLO) International is a non-profit, multi-stakeholder association with 23 member
organizations (Labeling Initiatives and Producer Networks), traders, and external experts. FLO develops and reviews fair trade standards and supports fair trade-certified producers by assisting them in gaining and maintaining fair trade certification and capitalizing on market opportunities.
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“Alter Trade is the most competitive in terms of quality and volume and is a model for organic muscovado, being the only company in the Philippines that is Institute for Market Ecology (IMO) -certified using European and US standards. Alter Trade has virtually no competitors because it is at a level above the rest of
the players in the subsector.”16 (Borje, 2008)
There were 4 entities that made up the Alter Trade Group: Alter Trade Corporation (ATC, set up in 1988) – which handled marketing of organic muscovado sugar, natural Balangon banana, and other products; the Alter Trade Manufacturing Corporation (ATMC, set up in 1992) – which handled purchasing and processing of organic sugarcane; the Alter Trade Foundation, Inc., (ATFI, set up in 1997) – which was in charge of the development of partner producers; and the Diversified Organic Enterprise, Inc., (DOEI, set up in 1997 ) – which produced organic fertilizer for use by partner growers.
These core and allied partner organizations making up the Alter Trade Group as a multi-organizational social enterprise system that were covered by the study are listed in Table 3.1.
Table 3.1. Alter Trade Group (ATG) Core and Allied Organizations
Name of Organization Role/Description
A. Core Organizations
Alter Trade Foundation Inc., (ATFI) Mother organization of the Alter Trade Group (ATG) and responsible for the development of partner producers
Alter Trade Corporation (ATC) Marketing arm of ATG; subsidiary of ATFI Alter Trade Manufacturing Corporation
(ATMC)
Purchasing and processing arm for organic sugar cane of ATG; subsidiary of ATFI
Diversified Organic Enterprise Inc., (DOEI) Organic fertilizer production arm of ATG; subsidiary of ATFI
B. Allied Organizations
Alter Trade Japan Exclusive trading partner for the Japanese market and shareholder of ATC
16At the international level, ATG’s four entities have received a Certificate for Organic Agriculture Production and for the Processing and Marketing of Organic Products from the Institute for Market Ecology (IMO) for its muscovado sugar, banana, and coconut products that are valid for 2007-2008 (Certificate # 9732 IMO). A similar Certificate was awarded by the US Department of Agriculture’s National Organic Program (NOP) to ATG (Certificate # 23008 NOP).
Name of Organization Role/Description Negros Organic Fair Trade
Association (NOFTA)
Independent federation of producers with 17 partner sugar farmer organizations of ATG as founding members. These 17 organizations included: AMANO DAFWARBA HCATRIFWO MIARBA NAPFWA NARB-MPC STARFA SIPFAWA STC-MPC Banana Grower Organizations in Negros Island
(Negros Occidental and Oriental)
PIBFA One of 33 partner banana grower’s organizations
of ATG Partner Organizations Engaged in Banana Trading with ATC outside Negros Island
PFTAC in Bohol
CORDEV in Northern Luzon PARTNERS in Panay Island
3.1.1. Poverty and Hunger amidst Sugar Crisis
The sugar crisis that hit Negros Island in the mid-1980s was a direct result of the lowering by the US of its sugar imports in general, and the share of the Philippines in the US quota system for this commodity, in particular. Philippine sugar exports to the US averaged 1.3 million tons per year from 1968-71 but reached a low average of 284,000 tons from 1983-1988, plummeting to 161,000 tons in 1988 (Dolan, 1991).
The economy of the island was almost completely dependent on sugar, with large tracts of land owned by an elite few who also controlled the sugar mills. In these sugar estates, farm workers were paid meager wages for slave-like labor and were prohibited by their landlords from planting crops other than sugarcane. As the few owners of land and capital, the Negrense elite, who also controlled the decision- making in government, had benefited disproportionately from the export-oriented monocrop economy, at the expense of the area, its people and their life support system (Dacanay, 1996).
In 1984, landless sugar workers, numbering 62,500 households, were the poorest among the poverty groups in Negros Occidental, followed by diversified shifting cultivators and upland farmers with 1 hectare or less of land, lowland farmers in non- irrigated lands, artisanal or municipal fishers, and coconut farmers (Aguilar, 1984). Poverty incidence in Region VI, where Negros Occidental was located, was placed at
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65%, with 227,096 families living below the monthly income threshold of PhP 2,654 (Family Income and Expenditure Survey (FIES), 1988).
As the price of sugar plummeted in the world market, many landlords in the sugar estates abandoned their farms, causing hunger among thousands of sugar workers. Land occupations by members of sugar worker unions became rampant, in an effort to transform the crisis into an opportunity for agrarian reform. Cooperatives and people’s organizations (POs) were set up and became conduits for relief, livelihood and income-generating projects.
3.1.2. Call for International Assistance
A call for international assistance was issued as the crisis deepened. In response to the call, the Japan Committee for Negros Campaign (JCNC) was launched on
February 25, 198617. The Campaign came in with relief goods, tools and agricultural
inputs. However, they wanted to develop a more long-term relationship of solidarity and suggested the setting up of an alternative trading system. As a manifestation of this idea, Filipino and Japanese social activists established the Alter Trade Corporation and further developed this concept in a conference sponsored by Japanese consumer cooperatives.
3.1.3. ‘Land to the Tiller’ in Sugar Lands
With the end of the dictatorial regime of President Ferdinand Marcos in 1986, a new Philippine constitution was put in place. Agrarian reform, carrying the principle
of ‘land to the tiller’ beyond rice and corn lands18, became an urgent agenda. The
passage of the Comprehensive Agrarian Reform Law (CARL) in 1986 opened up the opportunity for sugar workers to own the lands that they were already tilling. The law, and its implementing Comprehensive Agrarian Reform Program (CARP), also helped the process of legitimizing land occupations by sugar worker union members that were already widespread in Negros Occidental.
A study of the Negros Occidental Provincial Government some 20 years after, showed that 78,770 tillers became agrarian reform beneficiaries in the province (Provincial Government of Negros Occidental, 2007).
17
The people behind JCNC were Japanese activists who were part of the Japan Committee for Philippine Concerns. They were part of a campaign against the Japanese government’s aid policy towards the dictatorial regime of President Ferdinand Marcos, whom they accused of anti-labor policies and human rights abuses. The JCNC was organized the day after Marcos fled the country amidst a peaceful people’s uprising that installed President Cory Aquino in power.
18 The Marcos government initiated land reform which covered rice and corn lands, but did not include large agricultural
3.1.4. Lack of Agricultural Support Services amidst Domination
of Usurer-Traders
This shift from being farm workers to small land owners required the development of new capabilities. These new capabilities, in turn, created the need for organizations that could provide a package of assistance to these agrarian reform beneficiaries or ARBs. Such needs were made urgent by an agricultural trading system in the Philippines that had historically been dominated by usurer-traders. These usurer-traders lent production capital at very high interest rates and dictated farm gate prices. The idea of Alter Trade became even more compelling as the government’s Comprehensive Agrarian Reform Program (CARP) did not have the resources to offer much-needed agricultural support services to a majority of the ARBs. A 2007 study of the Negros Occidental Provincial Government cited that CARP, since its inception in the 1980s, had failed to reach 97% of agrarian reform beneficiaries in the province, with 41% of them unable to till their lands because of lack of capital and support services (Provincial Government of Negros Occidental, 2007).
3.1.5. MIARBA’s Story before Alter Trade
The story of the Minoro Isabel Agrarian Reform Beneficiaries Association (MIARBA), one of Alter Trade’s partner sugar producers, mirrored the squalor and struggle among a large segment of the poor in Negros Island in the 1980s. It also mirrored the opportunity created by agrarian reform, and the sad reality of an ineffective government program to support and move farmers out of poverty. These provided the rich historical context giving birth to Alter Trade as a social enterprise. (See Box 3.1)