Expensive food items caused inflation to post its highest rate in December since the Global Financial Crisis, according to the Philippine Statistics Authority (PSA).
The PSA said the country’s headline inflation increased to 8.1 percent in December 2022 from 8 percent in November 2022. In 2022, the average inflation rate was at 5.8 percent.
National Statistician Claire Dennis S. Mapa said the December 2022 inflation rate was the highest since the 9.1 percent inflation recorded in November 2008 while the full year 2022 inflation rate was the highest since the 8.2 percent level recorded in 2008.
“The higher inflation in December 2022 than in November 2022 was primarily brought about by the faster year-on-year growth rate in the index of food and non-alcoholic beverages of 10.2 percent from 10 percent in November 2022,” PSA said.
Food inflation at the national level rose further to 10.6 percent in December 2022, from 10.3 percent in November 2022. In December 2021, food inflation was far lower at 1.6 percent.
This was followed by restaurants and accommodation services whose inflation rate accelerated to 7 percent from 6.5 percent in November 2022.
Coming third was housing, water, electricity, gas and other fuels with an inflation rate of 7 percent in December 2022 from 6.9 percent inflation in the previous month.
“There is an urgent need to modernize the country’s agriculture and agribusiness to increase productivity and ensure that there is adequate, affordable, and nutritious food on the table of every Filipino,” Socioeconomic Planning Secretary Arsenio M. Balisacan said in a statement.
Balisacan also noted that these efforts complement the decision of President Ferdinand R. Marcos, Jr. to extend the validity of the reduced import rate duties on various products such as pork, rice, corn, and coal until December 2023.
“Executive Order No. 10, s 2022 will continue to provide diversified sources of food and agricultural inputs in the short term. The operational intervention, however, is to ensure food security by boosting food production, improving farm-to-market connectivity, and investing in disaster resilience, climate adaptation measures, and coordination mechanisms,” added Balisacan.
Enhancing the value chain through digital technology and development of climate-smart farm products will also play an essential role in securing food supply and prices.
Balisacan also highlighted the need to streamline disaster response and rehabilitation mechanisms to cope with the frequent weather disturbances experienced by the country.
Under this strategy, the government will mainstream the use of technology to predict supply chain disruptions; adopt site-specific, timely, and simplified climate outlook and weather forecasts; improve biosecurity measures; and accelerate the development of vaccines to control livestock and poultry diseases.
Image credits: Bernard Testa