Tuesday, October 07, 2008 Arroyo: Efforts to manage inflationary pressures are being exerted
PRESIDENT Gloria Macapagal-Arroyo said the government is working hard to cope with inflationary pressures.
During Monday’s 10th Semiconductor and Electronics Industries in the Philippines Inc. (SEIPI) Forum in Malacañang, Arroyo said the government is trying to address all fronts from managing the inflationary pressures to keep prices down to continuing to generate jobs and revenues.
“We've been working hard to make sure food supplies remain stable and to put food on the table for every Filipino in order to avoid demands for a wage spiral,” she said.
Arroyo acknowledged that increasing the wages adds to the costs of production, which at the moment remains affordable in the Philippines compared to other countries.
She said the government had adopted measures to lift the burden of high fuel and food prices to ensure that food prices remain affordable and that there will be no big transportation cost increase “so that there would be no demand for a wage spiral.”
She said the economic team in coordination with the Bangko Sentral ng Pilipinas is also closely monitoring developments in the global finance market as the government focuses on strengthening the domestic economy to help insulate the country and Filipinos from the impact of the global crisis.
The President said these measures include accelerated spending on infrastructure and agriculture, fast tracking of financial reforms to strengthen the banking system, improving of the fiscal health through better tax collection and legislative measures, and encouraging investments by reducing regulatory bottlenecks for strategic industries like the semiconductor and electronics industry.
Arroyo during the event also said the government continues to spend more on infrastructure and bring down electricity costs which would help keep the cost of production low.
She said the resiliency of the Philippine economy enables it to continue spending on infrastructure, unlike other countries that have "overheating" and eventually cut down in infrastructure spending.
She said such projects are South Luzon Expressway (SLEX), Alabang viaduct, Batangas Port, and Subic-Clark-Tarlac Expressway (SCTEX) which helps in bringing products closer from the factories to their destinations and eventually cuts down the cost.
The President also cited the implementation of an open access system, which would enable the consumer to choose their own power distributor, to help bring down electricity costs and eventually production costs.
She urged them to locate in areas where the local government receives royalties from the power sources in their areas which they eventually use to subsidize electric bills of their constituents like those in Valencia, Negros Oriental and in Ormoc, Leyte or within the Philippine Economic Zone Authority (Peza).
The President likewise cited the electronics industry for being the driver of the country’s economic growth as they accounted for about two-thirds of the total exports in the country.
She believed that while the electronics and semiconductor industry have predicted that they are likely to generate a flat rate of zero this year, they would eventually recover. (JMR/Sunnex)
