NEDA flags upside risks to inflation

Published February 6, 2020, 12:00 AM

by manilabulletin_admin

By Chino S. Leyco

The National Economic and Development Authority (NEDA) flagged the effects of the Taal Volcano eruption, spread of African swine fever (ASF), and novel coronavirus as upside risks to the country’s current staple inflation.

Socioeconomic Planning Secretary Ernesto M. Pernia said the government remains vigilant following the emergence of several unexpected phenomena this year that pose threats to the government’s 2.0 percent to 4.0 percent inflation target.

On Wednesday, the Philippine Statistics Authority reported that January inflation clocked in at 2.9 percent, faster than the 2.5 percent in the previous month, but slower compared with 4.4 percent in the same month in 2018.

“Despite the relatively stable inflation outlook, we cannot be complacent, as the balance of risks remains on the upside for 2020 due to the effects of the Taal Volcano eruption, spread of ASF, and 2019-nCoV,” Pernia said.

But Pernia also assured that the country has already intensified its preparedness for disaster risk response, including the formulation of recovery and rehabilitation plans, like in the areas affected by the Taal Volcano eruption.

“We should also increase investments in climate and disaster-resilient farm technologies and practices, and promote the adoption of such among farmers and fisherfolk,” Pernia added.

There is also a need to fast-track the implementation of interventions under rice competitiveness enhancement fund to improve productivity of local farmers, and to continue the implementation of mitigation measures, the official said.

Currently, the government identified three mitigation measures — rice farmers financial assistance, program quick response fund, as well as survival and recovery loan — to assist Filipino rice farmers’ transition under the rice liberalization law.

Moreover, Pernia said that at the local level, biosecurity and border control measures are being strengthened and regulation on the movement of pork products are strictly enforced around the country.

“We remain attentive to the recent developments abroad which could affect domestic pump prices. Over the medium- to long-term, it is essential for the country to explore alternative and cheaper energy from local sources to become less import-dependent,” Pernia said.

Further, Penria said that everyone should be on the guard vis-à-vis the 2019-nCoV, be cognizant of related developments here and abroad, and observe precautionary measures and advisories from the Department of Health and other concerned agencies.

As Pernia assured that the government is not letting its guard down, Finance Undersecretary Gil S. Beltran also said that food supply needs to be scaled up to reduce inflationary pressures following the slight acceleration of inflation in January.