Filipinos especially overseas Filipino workers (OFW) who are sending remittances into their family back home are alarmed by the high inflation rate which started August this year. Families are complaining about their budget which used to be enough is now hardly meet their monthly expenditures. The commodities, food and transportation causes continue to rise while the salary remains stagnant. What are the major contributors of price hike?
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The inflation rate is a measure of the sustained increase in prices of goods and services over a given period of time. It is being felt by people in a nation belonging to different walks of life. The 4.8% inflation rate is being pointed out as a major cause of the price hike of electricity, gas, fuels, fish, rice, personal transport, vegetables, and meat prices.
President Rodrigo Duterte attributed high inflation rates due to high tariffs imposed by the US government on some goods.
What is the contributing factor which causes the prices of commodities, especially food items and services to shoot up?
Department of Finance Assistant Secretary Tony Lambino explains the ten major contributors of the high inflation rates which include the following:
1. Electricity, Gas and other fuels.
Electricity increased .03 centavos from July to August this year. So, the average household which consumes 100 kilowatts/hr will have an additional P3 on their electric bill. However, the increase in progression started in July of 2017. Gas and other fuels refer to household utility gas or LPG and kerosene.
2. Fish
Increase in prices of fish is partly attributed to the recent restrictions of the Department of Agriculture to the commercial fishing vessels to stay away from municipal waters. There is also tightening of fish breeding due to climate change which affects the quantity of harvest and supply.
3. Rice
Prices of rice are the most significant among price increases being the staple food of Filipinos. It has increased from below P40 up to almost P50 a kilo.
4. Operations of personal transport equipment
Private vehicle owners also suffer from high prices of fuel. 75% of the increase is attributed to high prices of oil in the world market and weakening of Philippine Peso.
5. Vegetables
The vegetable price increase is said to be due to transportation cost and natural calamities which hampered vegetable production.
6. Meat
High prices of meat are caused by the higher cost of corn which is used as the main ingredient in making animal feeds. Another thing is that the diseases which affected chicken and swine across Asia Pacific region caused the low meat production.
7. Actual rentals for housing
Due to the expiration of the rent control act or RA 9653 which regulates rental rates, prices of rent also went up.
8. Catering services
Non-essential catering services include restaurants and fast foods where most of the Filipinos dine.
9. Non-alcoholic beverages
Non-alcoholic beverages including sweetened beverages prices have increased to 11.5% basically from increased excise tax levied to them.
10. Tobacco
Prices of tobacco have also increased due to higher excise tax and better tax administration imosed by the TRAIN law.
Asec Lambino identified these ten top drivers why we have high inflation rates and said the government is doing necessary efforts to address these problems by finding solutions accordingly.
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As the government exerts its effort to address inflation effects, we can also do our part. We provided several tips on what we can do about the rising prices of food. You can read the full article here.
Filed under the category of Filipinos, OFW, remittances, high inflation rate, commodities, food, price hike
Filed under the category of Filipinos, OFW, remittances, high inflation rate, commodities, food, price hike
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