Those of us who remember the fast rising prices of 2018, when the inflation rate hit a high of 6.8 percent in September, are now looking with some concern over the report this weekend that inflation just hit a two-year high of 4.7 percent.
The Consumer Price Index went up to 2 percent last January. That was when meat prices rose so high that the government put a price cap on pork and chicken, but supplies from the provinces quickly disappeared and without these supplies, vendors in Metro Manila simply closed their stalls. With the high farm prices in Mindanao, Visayas, Mimaropa, and Bicol, plus transport costs, the price caps ordered by the government in Metro Manila could not be met. There was also African Swine Flu which further limited the meat supply.
One solution reportedly proposed by the Department of Agriculture -- the importation of pork – was roundly condemned by Sen. Cynthia Villar at a hearing on rising food prices held by the Senate Agriculture Committee.
Agriculture Secretary William Dar said it was just a “temporary measure” – only a year of relaxed pork importation. “If you do that to local farmers for a year,” Senator Villar countered, “they will end up dead after a year.”
There is yet no agreed solution to the fast-rising prices of meat products. At the same time, the prices of oil products are also beginning to rise – due to increasing world oil consumption as nations start reopening their industries. The natural result of all these economic developments is rising inflation.
The inflation that hit the Philippines in 2018 was also due partly to rising world oil prices. But there was also a new P2.50 tariff imposed on diesel imports under the just approved Tax Reform for Acceleration and Inclusion (TRAIN) law. Private producers and traders were also accused of taking advantage of the situation to raise prices.
The result was a steady rise in the inflation rate. It was 4.5 percent in May, 5,7 percent by July, a five-year high. It continued to rise – to 6.4 percent in August, to 6.7 percent in September. It began to subside when the government enacted the Rice Tariffication Law which flooded the market with imported rice.
The people have already suffered so much from the still ongoing pandemic—loss of livelihood and income for many on top of continuing infections and deaths from COVID-19. Now market prices are rising; the inflation rate is now up to 4.7 percent.
We hope the government will find a way to stop the steady rise in the inflation rate before it hits the heights it reached in September, 2018.