As headline inflation rate further accelerated in January 2023, the National Economic and Development Authority (NEDA) said higher agricultural productivity, food supply augmentation, and energy security are top priorities of the government to temper upward price pressures.
“As part of the administration’s 8-point agenda and the Philippine Development Plan 2023-2028, the government is implementing measures to ease price pressures and cushion the impact of inflation, especially on basic commodities,” NEDA Secretary Arsenio M. Balisacan said.
He said NEDA has been working closely with agencies to ensure timely and efficient implementation of the strategies and programs laid out in the Philippine Development Plan (PDP) 2023-2028, particularly in modernizing the country’s agriculture and agribusiness and ensuring energy security.
The Philippine Statistics Authority reported today that the country’s headline inflation rate further accelerated to 8.7 percent in January 2023 from 8.1 percent in December 2022. This January 2023 inflation is the highest annual rate recorded since November 2008.
Electricity and vegetables, particularly onions, were the top contributors to January inflation, each accounting for 1.1 percentage points (ppt). Restaurant services and house rentals also accelerated and contributed 0.7 and 0.6 ppt, respectively.
Public and private transport contributed a total of 1.0 ppt. Other key agricultural commodities such as meat and fish contributed a total of 0.8 ppt, while processed food commodities such as sugar and bread & other cereals contributed a total of 0.7 ppt to total inflation.
The NEDA chief said the government has identified measures to keep food price movements consistent with the government’s inflation and food security objectives. Short-term measures include augmenting supply such as through temporary easing of import restrictions, price monitoring, and targeted social support.
In the medium to long term, the priority consists of ensuring food security through higher agricultural productivity and ensuring energy security by pursuing the energy transition and development program.
“Our measures are meant to balance the interests among local food producers, consumers, and the overall economy,” Balisacan said.
“As laid out in Chapter 5 of the Philippine Development Plan 2023-2028, a whole-of-society approach is crucial in modernizing agriculture and agribusiness, with both the government and private sector working hand-in-hand to enhance the efficiency of agriculture, forestry, and fisheries production,” he added.
On January 27, 2023, President Ferdinand R. Marcos Jr. signed Executive Order (EO) No. 14, s. 2023, directing the whole government to undertake efforts leading to the full implementation of the Plan.
“A robust and resilient agriculture is vital to ensuring that we have enough supply of food and to keeping food prices stable, especially as we continue to face global headwinds and are exposed to natural hazards. Importantly, it serves as foundation for a strong economy, as agricultural products move up the value chain,” added Balisacan.
Among the strategies in Chapter 5 of the Philippine Development Plan 2023-2028 are the consolidation and clustering of farms; use of appropriate modern technologies; integration of climate and disaster risks in farmers’ planning and programming; development and mainstreaming of early warning systems/anticipatory mechanisms; the boosting of local production capabilities; and the enabling of market-friendly trade and investment policy for agriculture and food.
The economic managers expect inflation to moderate for 2023 to 2024, with a slower-than-expected global recovery and waning pent-up domestic demand. Moreover, the impact of Bangko Sentral ng Pilipinas policy rate hikes is anticipated to be felt this year.