The Department of Agriculture (DA), World Bank, and the United Kingdom on Friday launched the $1-billion Philippine Sustainable Agriculture Transformation (PSAT) program designed to modernize and boost food production and security in the country.
PSAT is the Philippines’ first project under the World Bank’s Program-for-Results model.
One of the program’s key features is its utilization of disbursement-linked indicators, which require the government to meet targets before accessing funds. Despite possibly slowing initial fund releases, it compels the government to practice accountability and pursue outcomes, Agriculture Secretary Francisco Tiu Laurel Jr. said.
“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,” he noted.
The project marks a shift toward results-driven development financing and is a “vote of confidence” in the DA’s reform agenda, Tiu Laurel added.
The program focuses on three result areas: increased rice-based farming output; enhanced efficiency and climate-resilience in value chains; and improved institutional performance.
The government expects the program to provide an initial $300 million in funding this year, allowing for support amid the energy crisis, as well as 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,” said Zafer Mustafaoğlu, World Bank division director for the Philippines, Malaysia, and Brunei.
The loan is paired with a $24.5-million Technical Assistance for Sustainable Agriculture Transformation (Tasat) grant. It includes a $14.5-million contribution from the UK through its Just Rural Transition Support Program.
“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,” said British Ambassador Sarah Hulton, OBE.
“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 added.
DA Assistant Secretary for Official Development Assistance Arnel de Mesa said PSAT and Tasat could serve as test cases for results-based financing in the country, given their focus on measurable results that come first before fund access.
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