Bamboo economics

The following is an article sent to me by Isidro “Butch” Alcantara, a former bank president (PBCom) and a veteran banker. He talks about bamboo economics.

Bamboo stakeholders under the 5K Bamboo Foundation are pushing for the creation of a National Bamboo Industry and Bamboo Economics.

The group is led by Philippine Bamboo Industry Development Council (PBIDC) vice chairman Deogracias Victor Savellano, executive director Rene Madarang and former Philippine Nickel Industry Association chairman Isidro Alcantara, who pioneered bamboo for mining rehabilitation in Marcventures Mining in 2018.

Bamboo is a $70-billion global industry. China accounts for $35 billion, employs 10 million direct jobs on 4.2 million hectares.

At only 10 percent of or 400,000 hectares only, a mature Philippine bamboo industry could contribute $3.5 billion/P192.5 billion to the economy or 1.4 percent addition to GDP and 21 percent increase in the assumed GDP growth rate of 7 percent and proportionally add one million new jobs.

With 3.75 million hectares unplanted out of the country’s 9 million hectares of arable land, suitable soil and climate and about 11 species of high economic value, he added.

Former congressman Deogracias Victor Savellano emphasized that bamboo can help achieve a major policy goal of the administration as a force for climate change mitigation, which PBBM mentioned in his first SONA and in the UN as it releases 38 percent more oxygen and captures 12 to 17 tons of carbon in addition to potential carbon credits.

He welcomed the passage of HB7941 or the Philippine Bamboo Industry Development Act of the 19th Congress which he co-authored in the 17th Congress.

Bamboo is a realistic source of renewable energy (biomass) and replacement for fossil fuels. Some countries plan to replace coal with bamboo pellets because it has a high calorific or heating values like coal, without fossil fuel carbon emissions.

Calorific heating value of bamboo pellets is 4,500 Kcal/kg to 5,000 Kcal/kg, similar to the 4,200 Kcal/kg for low grade coal up to 5,800 Kcal/kg for high grade coal.

The strategy is to promote large scale plantations surrounded by processing and manufacturing entities like China to attain maximum economic value benefits from high-value products and to create small- to medium-scale bamboo villages in identified natural growth mature bamboo areas and create processing entities for basic bamboo products like Vietnam’s 100-hectare bamboo villages.

Madarang has been going all over the country promoting community-based bamboo enterprises.

“The two-pronged strategy will allow immediate benefits to the countryside and precede development of a major bamboo industry” he said.

There are many groups and individuals already making basic bamboo and higher value products but not on a scale needed to attain potential major economic contributions.

Alcantara says we have strong technical expertise on bamboo from the UP Los Baños and some Filipino scientists like former DOST Undersecretary Flor Tesoro and Anneth Singh, who stayed 10 years in Vietnam helping develop their bamboo industry.

There is a pioneer large-scale plantation of 5,000 hectares in Pangasinan under CS First Green of former Bayambang mayor Cezar Quiambao showing it can be done.

A mandate from the President can lead to an accelerated development of a bamboo industry that may well be accomplished during his term and be a lasting legacy.

Passage of House Bill 7941 supported by Speaker Romualdez together with a national mandate from President BBM may finally bring results, according to Savellano.

Alcantara adds that a National Bamboo Industry is pursuant to a reported policy statement by President BBM in 2022 that “to achieve economic growth and recovery we shall emphasize responsible sustainable mining and industrial agricultural plantations.”

Marcventures started using bamboo for mine rehabilitation in 2018 and a study confirmed that income from producing and selling poles by a bamboo farmer with a 10-hectare plot yielded almost ¥116,000 or P1 million yearly – 4x the salary of a comparative mine worker.

Beneficiaries would be far-off rural populations and indigenous peoples around mining and agricultural communities. A major impact of a bamboo industry is income upliftment and social amelioration, especially in the farther-off rural areas and the countryside.

The study was done by the International Network of Bamboo and Rattan (INBAR), a 48-member country association based in Beijing.

The Philippines is a member. Community bamboo villages in untapped natural bamboo growth areas could be organized into income-producing enterprises for basic products like handicrafts and toys.

To operationalize the bamboo industry, several steps can be undertaken.

For the near- and medium-term, we should organize community-based projects for immediate income-producing ventures; identify areas of natural growth bamboo and organize bamboo villages; identify, if any, LGU-controlled lands in local communities and set/support community bamboo planting projects and basic processed products and organize local (LGU) bamboo councils to lead small community bamboo projects for  farmers, fisherfolk, socialized housing, Madarang adds.

For the long term from which the maximum economic contribution will come, Alcantara says we must set policy and actionable support and encourage large-scale plantations and surround them with processing industries for maximum benefit. Incentivize and attract both foreign and domestic capital investors.

Fast track bamboo plantation industrial forest management agreements or IFMAs and processing plants; provide longer tenures for IFMAs; fiscal incentives such as income tax holidays, tax free imports of capital/processing equipment and implicit tree cutting in IFMA Areas.

Mining can be a model and catalyst for bamboo plantations. It has the large non-mineralized open areas in the MPSAs plantable to bamboo and available mandated regulatory funds.

As incentive, Alcantara recommends granting added five hectares mining area for every 250 hectares planted to bamboo under DAO 2018-19.

To address the lack of capital in the higher risk agriculture industries, we need a strong framework to attract domestic and foreign investment and, more importantly, to provide risk-reduction mitigation through co-investment risk sharing.

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