April 6, 2021

The government is committed to stabilizing prices by augmenting food supply and ensuring that the supply chains of goods, especially food, will be unhampered during the enhanced community quarantine (ECQ) period, said the National Economic and Development Authority.

The Philippine Statistics Authority reported today that the country’s headline inflation rate fell to 4.5 percent in March 2021, from 4.7 percent in the previous month. This is the first easing of the inflation rate since September 2020.

The slower inflation in March 2021 was mainly driven by the decrease in the price indices for major food items. Inflation eased for vegetables (8.3 percent from 16.7 percent), fruits (3.9 percent from 7.4 percent), and fish (4.9 percent from 5.1 percent). The supply of vegetables and fruits has increased given better weather conditions and the onset of the harvest season for selected agricultural products. However, the continued supply deficiency in meat, particularly pork, means that it remains the leading driver of inflation at 20.9 percent from 20.7 percent in the previous month.

“The lower inflation rate recorded for March shows that our decisive policies are working. For instance, higher fish imports complemented the lifting of the closed fishing season, and this led to lower inflation for fish which is especially important in the face of elevated meat inflation. We will continue to address supply issues and logistics bottlenecks to ensure price stability, especially for food and essential goods. We are working with a great sense of urgency to protect the purchasing power of the people, majority of whom have lower or forgone income as a result of the ECQ, and ensure better access to healthy, safe and affordable food,” Acting Socioeconomic Planning Secretary Karl Kendrick T. Chua said.

Despite being outside the central bank’s target range of 2.0 to 4.0 percent, the lower inflation rate recorded for March is a good indicator of price stabilization. Moving forward, the government expects price pressures to subside as a result of proactive interventions.

“The President has already proposed to Congress the increase in the minimum access volume of pork. A temporary decrease in pork tariffs is also being considered. These will help lower our inflation rate further and keep it within the government’s targets,” the NEDA chief added.

Chua reiterated the government’s commitment to support farmers and producers by providing the necessary assistance and promoting innovative production technologies.

He also renewed his call for the public and private sector to take advantage of the digital economy and e-commerce, especially for agricultural products and other basic commodities. He added that digital platforms provide benefits to both producers, who can market their goods to more buyers, and consumers, who are given more options.

“In managing inflation throughout this crisis, we must innovate and adapt quickly. The government will continue to adopt evidence-based policy actions and seize opportunities to guarantee the Filipino people’s access to affordable, nutritious food and high-quality goods and services,” Chua said.

 

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