The delayed implementation of the reduced tariff on pork importation and higher import cap is slowing down the pace of food price reduction, the Department of Finance (DOF) said.
Finance Undersecretary Gil S. Beltran said the nearly three-month delayed application of Executive Order No. 128 impaired efforts to immediately address the supply shortage and soaring prices of pork in the domestic market.
President Duterte signed Executive Order No. 128 last April 7, but according to Beltran, who is also the DOF’s chief economist, the reduced import taxes were only implemented in July.
Citing data from the Philippine Statistics Authority (PSA), Beltran noted that the contribution of meat inflation to the consumer price index dropped only from 1.09 percent in August to 1.03 percent in September.
Moreover, pork supply deficit in the country remained huge at 651,000 metric tons, the finance official said.
“The food price reduction would have been larger if not for the continued large pork supply deficit,” Beltran said. “This resulted from the delay in the implementation of pork tariff reduction.”
Still, Beltran elaborated that Executive Order No. 128 helped in dampening food price inflation pressures.
The country’s headline inflation rate decelerated to 4.78 percent last month, slowing down from 4.87 percent in the previous month.
The September inflation rate is below the median outlook by private sector economists and at the low-end of the Bangko Sentral ng Pilipinas’ projection.
“Both the food and non-food major sectors contributed to this easing in the general prices,” Beltran said.
Inflation rate averaged 4.57 percent in the third quarter and 4.47 percent for the first nine-months of the year.
Food inflation eased from 6.93 percent in August to 6.5 percent in September.
Price inflation of meat decelerated from 16.4 percent to 15.6 percent and fish from 12.39 percent to 10.2 percent. They more than offset the acceleration in vegetable price inflation from 15.7 percent to 16.2 percent.
Month-on-month, the general price level remained flat with food inflation declined by 0.36 percent, largely on account of meat and fish, both of which declined by nearly 1.6 percent. Non-food price inflation, meanwhile, eased further to 0.17 percent from 0.25 percent.
Core inflation also stood steady at 3.32 percent, practically unchanged from the previous month’s 3.33 percent.