THE GOVERNMENT must seal food and energy-security agreements with its Association of Southeast Asian Nations (ASEAN) neighbors to mitigate the impact of the Iran crisis, the Philippine Chamber of Commerce and Industry (PCCI) said.
“What is immediate, as we chair the ASEAN, is look at our energy, water, food security now,” PCCI President Ferdinand A. Ferrer said on the Money Talks with Cathy Yang program on One News on Monday.
“Hopefully, there is agreement when it comes to food security and sharing of these resources.”
He said that the Philippines, a net importer of oil, should also explore an energy security agreement with its neighbors.
He noted that large enterprises are studying how long they can withstand surges in the cost of raw materials and logistics.
“Large companies (are) looking at how long can they withstand the upcoming increase in logistics costs… and in raw materials, which will, probably in the next week or week and a half, increase,” Mr. Ferrer said.
The PCCI is also looking to support micro, small and medium enterprises (MSMEs), which are more vulnerable to price shocks.
“Our biggest concern now are the MSMEs which will immediately bear the brunt. They have limited financial resources. So, we’re coaching and mentoring the MSMEs on how to save,” Mr. Ferrer said.
As an import-dependent country, Filipino consumers will also have to absorb looming price hikes, he said.
“Whether it’s from rice or from other goods that are being shipped to the Philippines, eventually, all these price increases will trickle down to the consumers,” he noted.
The possibility of the peso hitting P60 against the dollar will blunt the impact somewhat on exporters, though logistics costs will inevitably have an impact, Mr. Ferrer said.
The peso weakened by 13.50 centavos to close at P59.87 against the dollar Monday.
To offset high logistics and fuel costs, Mr. Ferrer cited the need to improve trade facilitation.
“When you have trucks lining up because of port congestion or empty containers, it costs these transportation companies waiting in line,” he said.
“An efficient trade facilitation system will help mitigate the cost of fuel and logistics,” he added.
Separately, the Philippine Amalgamated Supermarkets Association (PAGASA) said consumers have not yet resorted to panic-buying.
“I asked members and it seems like nobody went panic buying. It was their usual payday weekend shopping,” PAGASA President Steven Cua said in a separate interview on the same program.
He noted that a major manufacturer had been planning to increase prices even before the war in the Iran started.
“Aside from that, nobody else has mentioned that they were going to increase prices so far,” he said.
Mr. Cua advised consumers not to go overboard with their purchases.
“Our advice is that you just buy — if you want to be safe — 15% maybe on top of what you really need,” he said. — Beatriz Marie D. Cruz
