Lower rice prices may be temporary, warns economist By Cai U. Ordinario @caiordinario
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ILIPINOS may have heaved a sigh of relief as inflation cooled in September but one of the causes, lower rice prices, may be temporary and lead to greater volatility in domestic prices of the staple, according to an economist. Ateneo de Manila University economist Leonardo Lanzona Jr. told BusinessMirror that a decrease in international rice prices could also make the country more dependent on imported rice. This dependence may lead to the country’s increased vulnerability brought by global market prices. This could translate to higher inflation each time rice or oil prices would spike.
‘LAB FOR ALL’
President Ferdinand R. Marcos Jr. engages a person with disability during the rollout of the government’s “LAB for ALL” project in Pasig City recently. The LAB for All, a priority project of First Lady Louise Araneta-Marcos, provided free medical and other state services to 1,500 beneficiaries. CONTRIBUTED PHOTO
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“ The decline in inf lation is fundamentally short-term in nature as this is driven by external factors. While these policies offer temporary relief, they expose the Philippines to risks associated with global market volatility,” Lanzona said. The country’s tariff and monetary policies, in general, have allowed the economy to be immediately affected by international developments such as rising interest rates and prices, Lanzona added. Ibon Foundation Inc., meanwhile, said despite the slowdown in rice inflation to 5.7 percent, the price of regular-milled rice in the National Capital Region (NCR), for instance, still increased by P3 or about 7 percent to P46 in September 2024 from P43 in September 2023 while
well-milled rice rose by P4 or 7 percent to P53 from P49. “But rice varieties priced over P50 per kilo tend to be more common at the market. Some one-third of domestic palay costs are from imported inputs, not yet counting further oil-dependent transportation costs to bring rice to retailers and consumers,” Ibon said. Worth noting, Ibon also said, is the inflation experienced by the poorest Filipinos at 2.5 percent in September. This is slower than the 4.8 percent in August 2024 but was faster than the 1.9 percent average inflation rate experienced by all income households. Ibon noted that expensive rice impacts the poor more heavily because around 54.93 percent of their budget goes to food. Based on the data from the Philippine Statistics Authority
(PSA), rice has a weight of 17.87 percent in the Consumer Price Index of the poorest Filipinos. The group also stressed that wages are not keeping up with high prices. Ibon estimated that across all regions, the average nominal wage of P448 is 63.1 percent short of the average family living wage (FLW) of P1,213 for a family of five, as of September 2024. In the NCR, even with the July 2024 wage hike, the P645 nominal wage is P561 or 46.5 percent short of the P1,206 NCR FLW. T he d ispa r it y bet ween t he nominal wage and the FLW is most glaring in the Bangsamoro Autonomous Region in Muslim
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Monday, October 7, 2024 Vol. 19 No. 356
See “Rice,” A2
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NG SUBSIDIES DECLINE 25% TO P87B IN JAN-AUG S By Reine Juvierre S. Alberto
UBSIDIES provided by the national government to state-run corporations went down by almost a quarter to P87.025 billion as of the end of August 2024, according to the Bureau of the Treasury (BTr).
Data from the Treasury showed subsidies declined by 24.89 percent, or P28.838 billion, to P87.025 billion from January to August 2024 from the P115.863 billion recorded in the same period in 2023. The bulk, or a total of P59.434 billion, of the government subsidies were allotted to major non-financial government corporations. This represents a 42.39-percent increase compared to the P41.740 billion extended to these entities last year. The National Irrigation Administration (NIA) is the largest recipient, obtaining half or 56 percent of the total subsidies to government-owned and -controlled corporations (GOCCs), amounting to P48.885 billion as of end-August 2024. Among the major non-financial government corporations, the National Housing Authority (NHA) followed NIA with P3.799 billion in subsidies. The National Food Authority (NFA) and National Electrification Administration (NEA) also received P2.250 billion and P2.088 billion, respectively. Budgetary support to other government corporations significantly declined by 222.90 percent year-on-year to P22.805 billion as of end-August 2024 from P73.637 billion. The Power Sector Assets and Liabilities Management (PSALM) Corp. was allocated P8 billion; followed by the Bases Conversion and Development Authority (BCDA) with P2.228 billion; and the Philippine Rubber Research Institute (PRRI), P1.546 billion. See “NG,” A2
FILING FRENZY (Clockwise from top left) Candidates filed their certificates of candidacy over the weekend for next year’s midterm elections: Sen. Pia Cayetano seeks reelection; Erwin Tulfo, congressman and former DSWD secretary, is running
for senator; former Comelec commissioner Rowena Guanzon and singer and government executive Jimmy Bondoc are also vying for a Senate seat. Leila de Lima, recently acquitted after years of detention, is running under the Mamamayang Liberal Party-list, alongside former congressmen Teddy Baguilat and Erin Tañada. Meanwhile, former Vice President Leni Robredo, pictured with election lawyer Romulo Macalintal, filed her COC for Naga City mayor, marking her return to politics in her hometown. ROY DOMINGO, JUSTINE GARCIA, BLESS OGERIO/ROBREDO PHOTO COURTESY OF ROMY MACALINTAL
COMCLARK OFFERS TO MANAGE CAAP’S AIR TRAFFIC SYSTEM By Lenie Lectura @llectura
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OMCLARK Network and Technolog y Cor p. has submitted an unsolicited proposal to manage the air traffic system of the Civil Aviation Authority of the Philippines (CAAP). “Yes, we’ve submitted to help government in improving our air traffic systems. Together with our international partners, we have the technology, capability, and experience to ensure that our air transport system is
among the safest and the best in the world,” said ComClark Chief Executive Officer Dennis Anthony Uy on Sunday. CAAPDirectorGeneralManuel Antonio Tamayo confirmed COMClark’s interest. “It is being considered. But that has to be evaluated, but nothing is final because it’s unsolicited,” he said, referring to COMClark. The government has yet to decide if it will opt for an unsolicited proposal or proceed via a Public Private Partnership. See “ComClark,” A2
Create More to level LGUs’ interpretation of taxes–Ibpap By Andrea E. San Juan @andreasanjuan
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EY provisions expected in Create More, which could be signed into law in a week or two, will ease investors’ headache as this will level the interpretation of local government units (LGUs) and implementation of taxes, among others, according to the IT and Business Process Association of the Philippines (Ibpap). “What I like to say is that Create More eliminates a lot of uncertainty and confusion in the different interpretations of specific laws and tax effect of laws because a lot of LGUs in this country...occasionally have different interpretation and
implementation of taxes including the issuance of business permits,” Ibpap President Jack Madrid told reporters on the sidelines of the recent IT-BPM Summit. “So I think that is one major headache that investors will now not have to have because of this clarification,” added Madrid. The Ibpap chief said this after Frederick Go, Special Assistant to the President for Investment and Economic Affairs, laid out the key provisions in Create More that will be beneficial for the IT-BPM industry. Madrid, however, pointed out that the improved clarity on work See “LGU,” A2
PESO EXCHANGE RATES n US 56.2650 n JAPAN 0.3832 n UK 73.8816 n HK 7.2469 n CHINA 8.0251 n SINGAPORE 43.4077 n AUSTRALIA 38.4853 n EU 62.0772 n KOREA 0.0422 n SAUDI ARABIA 14.9884 Source: BSP (October 4, 2024)