Gov’t preparing for possible price spikes over Iraq crisis

MANILA, Philippines – President Benigno Aquino III said on Tuesday, July 1, that the government is preparing measures to shield basic commodities from further price spikes should the situation in Iraq worsen.

Aquino also said in a news briefing in Clark Air Base, Pampanga, that he has ordered the Department of Agriculture, Department of Trade and Industry, and the Bureau of Customs to check whether smuggled garlic seized by authorities can be released for domestic consumption, to bring down garlic prices.

While responding to questions about higher prices of some commodities, including  rice and garlic, Aquino said another factor that may affect local prices of goods is the conflict in Iraq, where fighting between the Islamic State of Iraq and the Levant (ISIS) and Iraqi security forces is threatening Iraq's largest oil refinery.

He cited media analysis that a further deterioration of the situation in Iraq would drive up oil prices, since it is a major oil-producing country. 

“So that’s also a factor in moving, for instance today, [prices of] milk and bread.  We import the flour, we import dairy products to the tune of 99%, but we will be taking steps to minimize the impact of such,” he said.

Garlic test, increased monitoring

As for garlic, the President said state intervention through government “rolling stores,” which sell basic commodities in depressed communities at lower prices, has not delivered the intended effect.

“One of those things that gave me pause for consideration was the rolling stores of the DA and the DTI, specifically on the items that were the subject of the price increases. What they had unloaded [to the market] was rather substantial but it didn’t have a substantial effect on prices,” he said.

Because of this, he said, he ordered authorities to conduct phytosanitary testing for smuggled garlic confiscated by Customs, to check if it can be released without damaging local crops.

“I did instruct them that if it has passed and in conformity with the laws, we will unload all of these confiscated garlic to ease the pressure on prices,” he said.

The President also that the DTI has stepped up its monitoring activities and enforcement of laws against unscrupulous traders, and would “implement strictly the suggested retail pricing on manufactured and processed goods.”

“Those who will be found to violate the Price Act and others, the illegal sale of rice, they will be subjected to very hefty fines and criminal cases will also be filed,” he said.

The President had earlier said that the government would import additional rice, or on top of the 800,000 metric tons that it had set for 2014,  to ease local prices. –