MALACAÑANG and the country’s economic team on Friday, January 4, credited the “decisive actions” that they took for the lower inflation rate, reported at a seven-month low of 5.1 percent in December 2018.
In a statement, Presidential Spokesperson Salvador Panelo attributed the latest development to President Rodrigo Duterte's decisive actions to tame the rise in consumer prices.
"The Palace attributes this primarily to the President’s comprehension of the dynamics of Philippine economy and his corresponding actions of providing remedies to draw to a close the unease of the ordinary consumer," Panelo said.
He was referring to an administrative order and three memoranda that the President signed in September last year to curb the soaring prices of goods.
Administrative Order 13 streamlined procedures on the importation of agricultural products, while Memorandum Orders 26, 27, and 28 helped stabilize prices of basic agricultural commodities at reasonable levels and maintain sufficient supply in the local markets.
The economic team, in a separate statement, said the slowdown in the increase in prices of goods and cost of services “signifies that the mitigating measures already in force are broadly effective.”
The Philippine Statistics Authority (PSA) reported earlier Friday that the December 2018 headline inflation rate decelerated to 5.1 percent from 6.0 percent in November 2018.
It was the lowest in seven months, the agency noted. The economic team this figure brought to 5.2 percent the average full-year 2018 inflation, which is higher than the 2.9 percent in 2017 but within the adjusted forecast of the Development Budget Coordination Committee.
The country’s headline inflation had been accelerating since June 2018, when it was recorded at 5.2 percent. It increased to 5.7 percent in July, 6.4 percent in August and peaked at 6.7 percent in September and October before going down to 6.0 percent in November.
The economic managers - the heads of the National Economic and Development Authority, Department of Finance and Department of Budget and Management - said the rate of price increases has remained manageable, “giving the country adequate elbow room to sustain its economic growth and reach its development goals.”
“Still, we understand that the faster inflation, particularly in the middle of 2018, had affected many Filipinos, most especially those in the disadvantaged sectors. For this very reason, the economic team took swift and decisive measures to tame inflation as directed by the President,” the team added.
The economic managers said they will continue to exert all efforts to keep inflation within the government’s target range of 2 to 4 percent this year.
“While we can say that the worst seems over given the signs of easing price pressures, we continue to be vigilant of possible risks,” they added.
The economic team expects the Rice Tarrification Bill to be signed into law this year to bring down prices of rice by as much as P7 per kilo.
Although another round of increases in excise tax on fuel products took effect on January 1, 2019, the team said domestic pump prices should remain stable at the start of the year because the old fuel inventories are not subjected to the tax increase.
The Tax Reform for Acceleration and Inclusion (Train) Act, which was partly blamed for the surge in prices of goods in 2018, mandates the implementation of a second round of excise tax increases on fuel this year.
The economic team assured that the Department of Energy is closely monitoring the pump prices.
The also asked concerned government agencies to fast-track the implementation of the mitigating measures scheduled this year under the Train law, particularly the unconditional cash transfer and fuel vouchers, to fend off possible second-round effects.
The Palace, on the other hand, assured the public that the government would continue monitoring the prices of basic good and commodities.
"Despite this development, the President and this Administration will not fall into complacency in balancing the country's overall economic progress and alleviation of our people's distress to inflation," Panelo said.
"Filipinos can expect that we will remain vigilant as we continue to monitor the prices of basic goods and commodities, and implement measures to further ease the burden of our countrymen," he added. <>b>(With Ruth Abbey Gita/SunStar Philippines)