Editorial May 4 -10,2008 Issue

Increasing Prices
Drives Filipinos to Poverty

“Has Inflation Hurt The Poor? Regional Analysis in The Philippine”, is a study Asian Development Bank conducted (ADB).
Hyun Son, ADB economist said, “for every 10 percent increase in food prices, about 2.3 million Filipinos fall into poverty”. If the price of rice alone will increase to 10 percent, some “660,000 people will swell the ranks of the poor”. Families are caught in this struggle, not of their choice, will cut down spending on health, education, clothes and even housing.
The study analyzed the impact of price increases both in food and non-food commodities with the use of the years 2003 – 2006 data on the living standards of Filipinos across income levels.
The study found that a 10 percent increase in price of non-food commodities like fuel and utilities would drive 1.7 million people to poverty. The increase in Akelco rates for instance would drive people to the status of the poor.
Furthermore, “about 160,000 more Filipinos would slip into poverty with every 10 percent increase in fuel prices alone”. For the period 2003–2006, “the severity of poverty rose by 16.8 percent while the standard of living declined by about one (1) percent over the period”, the report said as published in the PDI issued on May 9, 2008.
With these findings in a credible study, what does the government do to alleviate poverty? Until today, the government has not approve the “Cheaper Medicine Bill” into law. Malacañang has turned with deep ears to the proposal of Senator Mar Roxas to suspend the collection of E-VAT. With the cost of fuel increasing almost weekly, the Filipinos will have no place to go but to be poor.
This price increases is giving to the poorest the greatest impact which are the majority of the Filipino populace. In Aklan, specifically, 42 percent belong to the below the poverty threshold. It will be worst for these households struggling to meet the minimum living standard. They may not have alternatives but to cut on food expenses, health, education, clothing and shelter. The urban poor will be badly hit too.
The government must now be prepared to respond to any worst scenario resulting to this ever increasing prices of basic life requirements.
Not only urban dwellers are the sure victims of this price increases. Small farmers are badly hit, and they are terrible victims. The government so far is solving the shortage of rice by importation. It buys imported rice quite high, but it buys palay of the small farmers at a very low price. The government has been insulting the palay farmers by buying their palay at low cost and importing rice at high cost. This is ignorance to the importance of Filipino farmers in nation building.
The Philippines by now could have been a surplus rice producer if it has only constructed irrigation systems instead of fertilizer scam and other scams.
The government must act now to mitigate poverty by instituting reforms, review irrelevant policies and streamline it to arrest poverty. /MP