The Philippines, when it joined the World Trade Organization (WTO) in 1995, has committed itself to trade liberalization as a strategy for achieving sustainable economic growth, thus providing the country’s agricultural producers greater opportunities for increasing exports while allowing for the lifting of import bans on most agricultural products;

In order to maximize the country’s gains from the policy of trade liberalization and minimize the adjustment costs in the shift toward a liberalized trade regime, Government has to institute measures and safety nets that would increase the agricultural sector’s productivity and enable it to achieve higher levels of competitiveness;

Pursuant to Republic Act (RA) No. 8435 – “Agriculture and Fisheries Modernization Act of 1997,” it is the mandate of the Department of Agriculture (DA)  to develop the agriculture and fisheries sectors under the following principles, namely: (1) poverty alleviation and social equity; (2) food security; (3) rational use of resources; (4) global competitiveness; (5) sustainable development; (6) people empowerment; and (7) protection from unfair competition;

Congress enacted into law in 1996 Republic Act (RA) No. 8178 – “An Act Replacing Quantitative Restrictions (QRs) on Agricultural Products, Except Rice, with Tariffs, Creating the Agricultural Competitiveness Enhancement Fund (ACEF), and for Other Purposes” where the ACEF (also herein referred to as the Fund) shall consist of the in-quota tariffs collected from the importation of agricultural products under the Minimum Access Volume (MAV) mechanism and deposited in a Special Account (Fund 183) in the General Fund;

To extend the utilization of the ACEF, Congress in 2008 amended RA 8178 through the enactment of RA 9496 – “An Act to Extend the Utilization Period of the ACEF” which converted the Fund into a revolving fund;

The DA issued various Implementing Rules and Regulations (IRR)/Guidelines via Administrative Orders (AOs) which were used as basis in implementing RAs No. 8178 and 9496 that resulted in the approval, financing and implementation of various undertakings such as loan and grant projects as well as scholarships for qualified student-recipients;

A  moratorium on the utilization and implementation of the ACEF for loan and grant projects was issued by the Office of the President in a communication sent to the Department of Budget and Management (DBM) in 2011 where clarifications on a number of ACEF operational issues as well as on the ACEF IRR/Guidelines were sought and upheld by the Office of the President (OP) in 2015 where issues raised by the DBM on the ACEF IRR/Guidelines remain to be addressed by the DA; However, the ACEF – Scholarship program resumed operation in 2012.

Congress enacted on May 2016 RA 10848 – “An Act Further Extending the Period of Implementation of the ACEF” which extended the Fund’s utilization until 2022 and provided for the promulgation by an ACEF Executive Committee (EXECOM) of new policies and guidelines necessary for the planning, administration, coordination and monitoring of the utilization of the Fund.