There were two events happening Tuesday at the Rizal Ballrooom of the Shangri-La Hotel in Makati – the Makati Business Club (MBC) and the MayBank-sponsored economic forum with inflation and the US-China trade war as the central issues up for discussion. I was at a crossroads – will it be MBC where there is a den of industry sources or the forum with Monetary Board Member (MBM) Felipe Medalla, Finance Assistant Secretary Ma. Teresa “Tere” Habitan, and visiting Singaporean-based May Bank senior economist Dr. Chua Huk Bin, as speakers.
I opted for the latter. Simply because the subject at hand – inflation – has been the trending issue due to its continuing climb.
When business journalists talk and write about inflation, almost always, the news is relegated to the business section. For political and mainstream news reporters, inflation is what they call a “nosebleed” topic. But, since it has become a “hot issue” everybody talks about it – from us ordinary individuals to the rich and famous.
In fact, taming inflation through legislative measures was among the central subjects of the President’s State of the Nation Address in July. It’s not a surprise that former President and now Pampanga Representative Gloria Macapagal Arroyo asked for an economic briefing when she assumed the speakership of the House. It’s the economist in her.
Inflation has become a political issue because it hits, hurts where it matters most: The narrowing purchasing power of the people, which has shrunk substantially. Imagine, fresh chili pepper or “siling labuyo” is now the most expensive local condiment. Though its price has dropped to P800 per kilo in the past month, it went back above to P1,000, same level in September. It used to be that “siling labuyo” comes automatically free when buying grilled fish in the weekend organic market.
Now, you have to request for it.
Indeed, inflation is now a political crusade. The bus for the mid-stream senatorial election has left the terminal. It’s loaded. Overcrowded, brimming with re-electionists, wannabes, and a new batch of politicians. Although based on the Commission on Election list, the number has dropped 11.6 percent to 152 aspirants from 2016’s 172. Except for some, like election lawyer Romulo Makalintal, fighting inflation is the common platform of most “senatoriables.”
She has gone a long way. At the forum, Ms. Tere confessed in part that TRAIN to a certain extent pushed inflation rate up. This is due to the excise tax slapped on petroleum products. Though, she insisted that the effect of TRAIN pales in comparison with the effect of the low rice supply in the market. Ms. Tere brought her audience down when she recommended that instead of taking your vehicle, try “walking,” a good form of exercise. “Stop driving, just walk.”
I’ve known Ms. Tere some eons ago. Back in the early ’90s whenever she saw us reporters entering Room 415, the office of the Corporate Affairs Group under Mrs. Juanita “Nitz” D. Amatong, she would in her librarian kind of voice and her way of warding us off, say in Pilipino, “Wala pa si Ma’am (referring to Mrs. Nitz). Listening to her serious presentation, she has mellowed.
Dr. Chua, on the other hand was clinical. She dissected the contagion effects of the US-China trade war on emerging economies like the Philippines. “It threatens the global and the Asia growth outlook.” Based on his analysis, the trade war is “inflationary for the US but deflationary for third countries.” Except for the Philippines, inflation in Asia remains contained.
MBM Medalla was true to form as he was professorial as ever, walking his audience down the whole nine yards of how inflation targetting works. Yes, it was Economics 101 but his parallelism was witty. He likened measures taken by the authorities to nip in the bud sustained increase in inflation to quash peso depreciation to “taking a constipation medicine for diarrhearia.” He added: “We killed inflation but we also killed the economy.”
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