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Rising inflation rate hits poor Filipinos

As food and other living costs become more expensive, consumers and the church are tightening their belts
Rising inflation rate hits poor Filipinos

The soaring inflation rate in the Philippines is expected to continue putting pressure on prices of basic commodities. (Photo by Jire Carreon)

Published: September 28, 2018 06:09 AM GMT
Updated: December 12, 2018 12:29 PM GMT

The place looked like a museum of religious images and paintings, with only the darkest corners lit for the celebration of the Eucharist.

More candles were lit to illuminate the altar, making it look like a stage for a medieval play. The ambiance added to the solemnity of the celebration.

The priest's intention was, however, far from artistic. He was not trying to be romantic. He was only saving on electricity.

Father Diogenes Barja, of Our Lady of the Assumption parish in Guinobatan town in the Philippine province of Albay, said the church is taking a beating from the worsening economic situation. "Inflation runs through everything and we are affected by it," he said.

The parish office has started to minimize the use of its air-conditioning unit. The kitchen has to make sure that no food is wasted, and "everyone is encouraged to tighten his or her belt."

"We have to be frugal in our consumption because we do not want our services to be compromised due to high prices of goods and basic needs," said Father Barja.

In the town of Vinzons, about 170 kilometers from Guinobatan, Roberto Ilan, a worker who earns US$7 a day, attends Mass every Sunday and until recently donated US$2 to the church. "The money is for the poor that the parish is serving," he said. "I don't mind giving that much."

A two-dollar contribution is very generous. Many churchgoers, especially in poor parishes across the country, can only afford less than a dollar.

In the past few weeks, however, Ilan has stopped offering cash. Instead, he brings a cluster of bananas, or sometimes a sack of root crops, as an offering.

"A kilogram of rice is worth a little more than one dollar. Transport fares have increased. Every centavo counts these days," he said.

In August, the Philippines' inflation rate reached 6.4 percent, the highest rate in nine years and higher than in all other Southeast Asian countries.

Independent think tank Ibon Foundation has reported that the poorest Filipino households have lost as much as US$50 since the start of the year because of inflation.

"At least 60 million Filipinos have suffered income losses because of accelerating inflation. It has eroded the incomes of the poorest families," said executive director Sonny Africa.

In January, the country's inflation rate increased to 3.4 percent. It rose to 5.2 percent in June, more than double the 2.5 percent rate in the same month a year ago and four times the 1.3 percent rate in June 2016.

Africa stressed that among the most important sources of inflationary pressure are the continuing depreciation of the peso, rising global oil prices and implementation of the new tax reform law.

"What the government should do is stop the execution of the new taxation and enforce price control for commodities," said Africa.

One major contributor to inflation is also the country's import-dependent and export-oriented economic policy. "Instead of uplifting the agricultural sector and implementing policies that would empower our peasantry ... the government is focused on importation," said Africa.

He noted that the import of basic food products like rice, fish and vegetables should serve as augmentation to resolve scarcity. "It should not compete with local produce and disenfranchise farmers," he said.

The Philippine Network of Food Security Programmes said that to address poverty, food shortages and inflation, the distribution of land to landless peasants should be increased.

"It has the capacity to uplift the lives of the poor majority of Filipinos," said Renmin Vizconde, executive director of the network.

She said the government should stop land conversion "because it contributes to the unceasing decrease of tillable land, which affects the annual productivity rate of agriculture."

"If the country starts progressing the agricultural sector now, we can avoid inflation and its impact in the future," Vizconde said.

On Sept. 11, President Rodrigo Duterte assured the public that his economic managers are working on addressing the problem.

"The economic life of the country cannot be a bed of roses," said the president. "I am not denying, because everybody on this planet Earth is suffering," he said.

Early this month, Duterte blamed the United States government's imposition of higher tariffs for the Philippines' rising inflation rate.

London-based research firm Capital Economics sees the peso sinking further to 55 against the dollar this year and falling to 58 in 2019.

In a report released on Sept. 14, Capital Economics said it expected the peso to slide due to a wider trade deficit aggravated by the government's infrastructure push.

A weak peso also puts pressure on prices of basic commodities.

The lights inside Our Lady of the Assumption parish church will remain dim for as long as needed.

Father Borja hopes the current economic situation will not worsen "because poor families will die of hunger."

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