Businessmen say inflation 'manageable,' but gov't must act now

Businessmen urge policy makers to revise certain policies, especially now that the causes of inflation are identified

Ralf Rivas

6:30:22am September 11, 2018

6:40:14am September 11, 2018

INFLATION. Businessmen are concerned over the effects of soaring prices. Photo by Ralf Rivas/Rappler

INFLATION. Businessmen are concerned over the effects of soaring prices. Photo by Ralf Rivas/Rappler

MANILA, Philippines – Several heads of major business groups appealed to the government to curb rising prices.

"No one is spared from the brunt of the rising costs. I feel sorry for our ordinary consumers and small entrepreneurs who are trying to make both ends meet...to survive," said Roberto Amores, president of the Philippine Food Processors and Exporters Organization (Philfoodex), on Tuesday, September 11.

Despite inflation hitting a fresh high of 6.4% in August, Sergio Ortiz-Luis of the Philippine Exporters Confederation (Philexport) assured consumers that it is still manageable.

According to Ortiz-Luis, inflation up to 8% is manageable. He cited figures during the presidency of Gloria Macapagal Arroyo, when inflation reached double digits.

"We were able to bring it down, it is possible," Ortiz-Luis said.

"We are not necessarily alarmed because you can see what is causing it. Prices of rice, sugar, fish, vegetables, services," he added in a mix of English and Filipino.

While Ortiz-Luis said businesses took a hit due to rising prices of raw materials, he said he is more concerned about the effects of inflation on the informal sector.

He noted that while 6.4% is not alarming, food inflation must be immediately addressed.

Recommendations

The two businessmen urged policy makers to review and revise certain policies that they said were no longer contributing to the government's agenda.

Amores urged the Department of Agriculture (DA) to allow local food processors to import 50% of their sugar requirement, or initially 100,000 metric tons.

Imported sugary products from countries which are part of the Association of Southeast Asian Nations (ASEAN) currently enjoy preferential tariffs of 5%.

"These food processors buy their sugar at the equivalent of P26 to P28 per kilo. These ASEAN products have been going into the country and threatening similar domestic products with sugar inputs priced from P60 to P65 per kilo," Amores said.

He also urged the government to review the ban on the use of modified danish sein (MDS) or hublot-hublot in catching fish. 

He said the prohibition resulted in the loss of about two million kilos of catch per day and jacked up fish prices.

The government banned the use of hublot-hublot as it causes damage to sea grass and corals.

Meanwhile, businessmen welcomed the government's bid to implement rice tariffication. They said it would address rising prices and supply issues.

Political noise

When asked about the effect of politics on business sentiment, Ortiz-Luis said businesses can tune out.

"The issue of [Senator Antonio] Trillanes has nothing to do with business. It is not our concern, investors are not concerned," he said. 

However, businessmen are concerned that the political noise has distracted officials from other pressing matters.

"I really hope that the President will announce steps to arrest rising prices," Amores said.

President Rodrigo Duterte was supposed to address the nation in a press conference at 3 pm on Tuesday. Businessmen had hoped that Duterte would tackle the economy.

But Malacañang announced around 2 pm that the President's press conference was canceled and would be replaced by a one-on-one chat with Chief Presidential Legal Counsel Salvador Panelo. – Rappler.com