Publication

The Quedan and Rural Credit Guarantee Corporation (QUEDANCOR) of the Philippine government under the Department of Agriculture is tasked to provide and distribute credit resources and initiate programs to help accelerate rural growth, generate employment and establish enterprises that provide more livelihood and income opportunities to small fishers. However, climate change as manifested in more frequent and more intense typhoons, floods, drought, as well as pests and diseases that affect the productivity of fisheries As such, small fishers are unable to pay their loans from QUEDANCOR, moreover they have difficulty renewing their loan applications from QUEDANCOR or accessing credit from other sources.  Failure to access credit could disable them to continue venture on fishing activities and could eventually jeopardize the welfare of their entire household.  The inability of creditors to pay their loans and meet their obligations also impair, to a large extent, the financial operation and viability of the lending institutions.  Risk management schemes currently employed include price stabilization measures, targeted relief` to typhoons and drought victims, and crop insurance systems, to name a few. Some of these schemes are becoming very expensive to implement.  Moreover, they fail to enable fishers regain sufficient resources so that they may continue production.  

Objectives: The purpose of this study is to analyze the natural risks and risk management practices of  Quedancor fisher borrowers; and to come up with appropriate measures to mitigate their adverse impacts on income and welfare. Specifically, the objectives are as follows: to estimate fishers’ production losses due to natural calamities; to document the coping strategies and mitigating measures done by fishers during natural calamities; and to recommend mitigation mechanisms to minimize the impact of natural calamities. Methodology: The study was undertaken in two stages. The first stage was the quantification of risks or expected losses to help determine the appropriate interventions to  trengthen QUEDANCOR programs.  It involved the analyses of the bio-physical and economic aspects of the agricultural production systems (e.g. fisheries and aquaculture).  The second stage was the identification of the effective mitigating measures and coping strategies to manage risks. The results of the analyses were used as inputs in rationalizing the decision options of QUEDANCOR, especially in relation to its lending operations.