Philippine economy

Cusi rejects lawmakers’ push for economic emergency amid high oil prices

Aika Rey
Cusi rejects lawmakers’ push for economic emergency amid high oil prices

RISING PRICES. An attendant changes the price billboard at a gas station in Paco, Manila, after another increase in fuel prices on March 8, 2022.

Rappler

'Even if you declare an emergency, what would you do with the emergency?' says Energy Secretary Alfonso Cusi

MANILA, Philippines – Energy Secretary Alfonso Cusi does not think that declaring a state of economic emergency is needed now, amid skyrocketing fuel prices.

In a media interview on Tuesday, March 8, Cusi was asked about lawmakers’ suggestion to declare an economic emergency. Albay 2nd District Representative Joey Salceda had said in a House hearing that a state of economic emergency would hasten the distribution of aid, for example.

“I don’t think it is necessary at this point. Even if you declare an emergency, what would you do with the emergency?” Cusi said.

He told reporters that the government is already “doing everything” it can.

“It’s a total effort of everybody so that we will be able to address this problem. Hopefully, this problem will not last long,” he said in a mix of English and Filipino.

Energy Undersecretary Gerardo Erguiza Jr. added that the necessary solution is not an executive decision, but a legislative one.

“If we look at the root of the problem, we don’t have control [over prices]. We need a framework and [only] our legislators can address it,” Erguiza said.

Erguiza seemed to refer to the request of the Department of Energy (DOE) for Congress to amend the oil deregulation law.

In particular, the DOE wants Congress to put a framework in the law that would allow the department to intervene when oil prices spike. The DOE also wants Congress to require the unbundling of retail fuel products to determine “true and passed-on costs.”

While the DOE pointed to legislative action on the matter, Congress is currently adjourned and will only resume session in late May. This means President Rodrigo Duterte would have to call for a special session.

Senate President Vicente Sotto III, in a chance interview on Tuesday, said the ball is in the President’s court.

“I leave it to the President.… Whether we are campaigning or not, we have to act on a special session call of the President,” Sotto said, as quoted by GMA News Online.

For now, public transport drivers and agricultural workers can only expect fuel subsidies from the government, totaling P6.1 billion. The DOE said the first tranche of the subsidy can be expected in March, while the remaining aid would be provided in April.

Transport groups are also in limbo, as the Land Transportation Franchising and Regulatory Board has yet to decide on their fare hike petitions seeking a P5 to P6 increase in minimum fare, which is currently at P9.

Economic managers also seemed to resist the idea of a fare hike, preferring subsidies instead.

Oil prices have been rising since 2021, with experts saying that the inflationary effects could hamper the Philippines’ economic recovery.

On Tuesday, oil firms implemented a massive price hike, with diesel jumping by P5.85 per liter and gasoline by P3.60. 

Cusi said fuel prices would only go down if Russia’s invasion of Ukraine ends, if the Organization of the Petroleum Exporting Countries and their allies would be able to meet global demand, and if Western sanctions on Iran and Venezuela, both oil-producing countries, are lifted. – Rappler.com

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Aika Rey

Aika Rey is a business reporter for Rappler. She covered the Senate of the Philippines before fully diving into numbers and companies. Got tips? Find her on Twitter at @reyaika or shoot her an email at aika.rey@rappler.com.