Inter-agency committee: Productivity boost as measure to ease food inflation

Finance Secretary Benjamin Diokno | Photo courtesy of Department of Finance

The government continues taking steps to mitigate food inflation despite easing in the past few months, Finance Secretary Benjamin Diokno said.

During the weekly Chat with SBED briefing, Diokno said the Inter-Agency Committee on Inflation and Market Outlook, led by the National Economic and Development Authority and the Department of Finance, has proposed several measures to address the issue.

Among the proposed short-term measures include strengthening the implementation of biosecurity and hog repopulation programs through continuous monitoring of the African swine fever and implementation of the Integrated National Swine Production Initiatives for Recovery and Expansion.

In the medium term, the solution to food inflation is to boost the productivity and resiliency of the agriculture sector. This can be done by promoting private investment in facilities, transport, and logistics systems to bring safe and nutritious food closer to consumers.

Diokno also said the government is preparing for the upcoming El Niño season, which is expected to cause a weak to moderate dry spell in the Philippines.

NEDA has presented the latest forecasts, potential impacts, as well as proposed activities to cushion its effects, especially on food security.

“A weak to moderate El Niño is projected until the first quarter of 2024. Because of this, we do not expect a significant reduction in local production – especially for rice and corn. As a result, we do not foresee a surge in food prices,” Diokno said.

NEDA also proposed the creation of the El Niño Team, as instructed by the President, to lead the government’s response.

The government is also closely monitoring the global economic slowdown, which could have an impact on the Philippine economy.

“We are closely monitoring the global economic slowdown, which could have an impact on the Philippine economy. However, we are confident that our strong fundamentals will help us weather this storm,” Diokno said.

Meanwhile, Power Sector Assets and Liabilities Management Corporation, which Diokno chairs, successfully bid out the 165-megawatt Casecnan Hydroelectric Power Plant in Pantabangan, Nueva Ecija.

“We are pleased with the outcome of the bidding for the Casecnan Hydroelectric Power Plant. This is a significant milestone in our efforts to privatize power assets and ensure that the sector remains competitive,” Diokno said.

On 16 May, PSALM received the highest bid from Fresh River Lakes Corp. amounting to $526 million or approximately P29.6 billion. The winning bid surpassed the minimum bid price of about $227.3 million, or about P12.8 billion.

Other notable bids were submitted by the consortium of EEI Power Corporation, Soosan ENS Co. Ltd., Soosan Industries Co., Ltd, Mapalad Power Corporation, and Neptune Hydro Inc.

This is the first power asset privatization under the Marcos Administration. The privatization of Casecnan will ensure that the sector remains competitive so as to reduce energy prices and increase efficiency.

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