MIF rules don’t bar a foreigner from top post By Cai U. Ordinario
Arsenio M. Balisacan told the BusinessMirror there is nothing in the Implementing Rules and Regulations (IRR) of the MIF that prevents a foreigner from leading the country’s sovereign wealth fund. As Neda Secretary, Balisacan is part of the MIF Advisory Body along with Budget and Management Secretary Amenah Pangandaman and National Treasurer Rosalia V. de Leon, who was appointed by the President to the Bangko Sentral ng Pilipinas (BSP) Monetary
@caiordinario
& Jasper Emmanuel Y. Arcalas @jearcalas
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FOREIGN national could become the first President and Chief Executive Officer (PCEO) of the Philippines’s sovereign wealth fund (SWF), the Maharlika Investment Fund (MIF), according to the National Economic and Development Authority (Neda). Socioeconomic Planning Secretary
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UPBEAT ON TOURISM Tourism Secretary Christina Frasco with Philippine Tour Operators Association (Philtoa) President Fe Abling Yu and Tourism Promotions Board COO Marga Nograles, is seen with Aliw Broadcasting Corporation executives led by EVP and General Manager Atty. McNeil Rante, DOT regional heads and members of the diplomatic corps during the launch of the 34th Philippine Travel Mart at the SMX in Pasay City on September 1, 2023. President Marcos has vowed sustained support for tourism as the sector seeks to exceed prepandemic levels. Story in Economy, page A3. BERNARD TESTA
Board over the weekend. “Yes, [there is] no nationality requirement for the President/CEO [of the MIF],” Balisacan recently told this newspaper. Data from the Sovereign Wealth Institute, the largest SWF in the world in terms of assets is the Norway Government Pension Fund Global with $1.48 trillion, followed by the China Investment Corporation with $1.35 trillion. See “MIF,” A2
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NEDA: RICE PRICE CAP w
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Monday, September 4, 2023 Vol. 18 No. 322
P25.00 nationwide | 2 sections 18 pages |
TEMPORARY, NECESSARY S By Cai U. Ordinario
@caiordinario
ETTING a temporary ceiling price on rice will give Filipinos a much-needed reprieve in terms of high inflation as well as discourage hoarding, according to the National Economic and Development Authority (Neda).
“We are confident that the imposition of a price ceiling is only a temporary measure. We expect the rice harvest to commence soon and anticipate that other initiatives will produce the desired result,” he added. Balisacan said rice prices are high because the country is currently “facing difficult times” particularly because of the Niño Southern Oscillation (ENSO) phenomenon which he considered “a major disruptor” as extreme weather events significantly affected agriculture, especially rice. The Neda chief said the ENSO intensified the Southwest Monsoon which would result in “belownormal rainfall towards the end of the year in many countries along the Pacific.” Another factor preventing the country from sourcing cheaper rice is “the trade-restricting protectionist behavior of certain riceexporting countries.” This includes India, which imposed a ban on its non-basmati rice exports to ensure that rice prices are low in the domestic market. “The aggressive move of rice-importing countries to secure supply have resulted in a decrease in the volume of rice being traded and expected to be traded in the global market.
BIRDS IN BLISS While birds blissfully feast on the grains at a rice store, seemingly oblivious to the bewildering high prices, human consumers grapple with a different reality. The concerns arise from illicit activities like hoarding and collusion among industry players during the lean season, aggravated by external factors such as the war in Ukraine, India’s ban on rice exports, and fluctuating oil prices. President Ferdinand R. Marcos Jr., concurrently the agriculture secretary, has called upon Filipinos to report any violations of Executive Order 39, which mandates a price ceiling of P41 per kilogram for regular milled rice and P45 per kilogram for well-milled rice. As of Friday, retail prices for local well-milled rice ranged from P47 to P57 per kilo, while local regular milled rice was priced between P42 and P55 per kilo, per the agriculture department’s monitoring. BERNARD TESTA
HOUSEHOLDS STILL BEAR MOST OF HEALTH EXPENSES–REPORT
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See “Neda,” A2
EXPLAINER »B4
CHINA’S NEW NATIONAL MAP HAS SET OFF A WAVE OF PROTESTS. WHY?
CECIL DZWOWA | DREAMSTIME.COM
In a statement issued after the President set a price ceiling on the country’s staple, Socioeconomic Planning Secretary Arsenio M. Balisacan backed the issuance of Executive Order No. 39 mandating a price ceiling of P41 per kilo for regular-milled rice and P45 per kilo of well-milled rice. (full story here: https://businessmirror. com.ph/2023/09/02/pbbm-setsnationwide-cap-on-rice-price/). Government economists have in the past usually frowned on price ceilings, saying they distorted market economics and punish only small rice retailers, not big-time traders and profiteers. However, the Neda chief stressed that the Marcos EO issued on Friday is a temporary option, and is part of a whole slew of measures to temper the spikes in prices of the staple. Balisacan said the country still had enough rice supply for the third quarter and the upcoming harvest season will ensure that the country has sufficient supply of rice for the rest of the year. “The imposition of a price ceiling on rice is not a standalone initiative. Law enforcement authorities continue their valiant efforts to crack down on individuals who hoard, excessively profit from, smuggle, or participate in rice cartels,” Balisacan said.
OUSEHOLDS continued to account for the bulk of the country’s health expenses, according to the latest Total Health Expenditure (THE) data released by the Philippine Statistics Authority (PSA). The PSA said THE amounted to P1.2 trillion, a decline of 1.4 percent from the P1.22-trillion expenditure in 2021. The share of THE to the Gross Domestic Product (GDP) at current prices was 5.5 percent in 2022. Of this amount, PSA said 44.7 percent was accounted for by Filipino households. This share was higher than that of the government, whose share was 44.2 percent of the total. “Out of the total health spending, Current Health Expenditure [CHE] contributed 93.4 percent, while the Health Capital Formation Expenditure [HK] shared 6.6 percent in 2022. CHE declined by 1.5 percent in 2022, while HK posted a 0.2 percent growth in the same year,” PSA said. Based on PSA data, the share of households in CHE was also higher than the share of the general
government in 2019. In that year, households accounted for 48.8 percent of CHE while the general government accounted for 40.8 percent of CHE. In 2022, the share of households to the CHE was again higher than the general government—which included the share of the central government, accounting for 20.9 percent of the total, and the Department of Health (DOH), a share of 15.5 percent. General government also included the share of local governments at 9.7 percent and social security agencies at 13.6 percent, which was mainly extended by PhilHealth. The PSA’s derived indicators also showed the out of pocket payment (OOP) by households reached P501.785 billion in 2022, a 5-percent growth from the P478.04 billion posted in 2021. On a per capita basis, PSA data showed health spending in 2022 amounted to P10,059.49, which was lower by 2.7 percent compared with the amount recorded in 2021 at P10,341.73. Cai U. Ordinario
Rice price cap must exceed equilibrium price–Salceda By Jovee Marie N. dela Cruz @joveemarie
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O prevent any impact of price ceilings, including rice hoarding and shortages, an economist-lawmaker said the price ceiling should be higher than the equilibrium price. House Committee on Ways and Means Chairman Joey Sarte Salceda made the statement following the issuance of Executive Order (EO) No. 39, which sets the price ceiling on rice in the whole country. “There is some arbitrage and undue padding of margins in the sector, and a rice price ceiling will help put a stop to that behavior,” pointed out Salceda. He said a rice price ceiling is a signal to those who wish to do price speculation that there is little profit in doing that. “In that sense, it will help prevent hoarding. But price ceilings can have negative second-round effects, such as shortages,” he said.
“If we want to avoid any shortage, the price ceiling should be higher than the equilibrium price,” he added. Earlier, President Ferdinand R. Marcos Jr. urged Filipinos to report violators of Executive Order 39, which sets the mandated price ceiling of regular milled rice at PP41.00 per kilogram and for well-milled rice, P45.00 per kilogram. To avoid shortages, Salceda said the Department of Agriculture must ensure that there is indeed enough supply in the market across all geographical areas. “Our monitoring of supply must not merely be at the aggregate national level. If you impose a price ceiling but some areas have less rice than they need, you will see supply problems in the rice-deficit areas. So, supply monitoring must also be localized, and some augmentation must take place in rice-deficient areas,” he said. See “Rice,” A2
PESO EXCHANGE RATES n US 56.7020 n JAPAN 0.3878 n UK 72.1476 n HK 7.2266 n CHINA 7.7791 n SINGAPORE 41.9984 n AUSTRALIA 36.7032 n EU 61.9639 n KOREA 0.0429 n SAUDI ARABIA 15.1157 Source: BSP (August 31, 2023)