{"id":19077,"date":"2024-06-05T03:12:51","date_gmt":"2024-06-05T03:12:51","guid":{"rendered":"https:\/\/energybuzz.ph\/staging\/6915\/neda-board-oks-low-tariff-regime-amid-rising-prices\/"},"modified":"2024-06-05T03:12:51","modified_gmt":"2024-06-05T03:12:51","slug":"neda-board-oks-low-tariff-regime-amid-rising-prices","status":"publish","type":"post","link":"https:\/\/energybuzz.ph\/staging\/6915\/neda-board-oks-low-tariff-regime-amid-rising-prices\/","title":{"rendered":"NEDA board OKs low tariff regime amid rising prices"},"content":{"rendered":"
\n

By Kyle Aristophere T. Atienza, <\/b><\/span>Reporter<\/i><\/p>\n

THE BOARD of the National Economic and Development Authority (NEDA) has approved a medium-term plan to lower tarif<\/span>fs on agricultural and industrial products, as the Philippines struggles with rising prices and declining factory performance.<\/p>\n

The NEDA board approved the Comprehensive Tariff Program for 2024 to 2028 amid concerns about inflation, which is widely expected to have quickened further in May. The expansion in local manufacturing output also slowed in May.<\/p>\n

Under the plan, the government would keep the rates for \u201cmore than half of the tarif<\/span>f lines\u201d for products that have relatively low tariffs,\u201d NEDA Secretary Arsenio M. Balisacan told a news brief<\/span>ing at the presidential palace on Tuesday.<\/p>\n

He said the program seeks to improve manufacturers\u2019 access to inputs and boost their competitiveness.<\/p>\n

\u201cThis measure will help our domestic industries by reducing the costs they incur for their inputs, enabling them to be more competitive, especially in the global market,\u201d he added.<\/span><\/p>\n

Mr. Balisacan said the board had approved a recommendation to reduce the tariff on certain chemicals and coal briquettes to \u201cimprove energy security and reduce input costs.\u201d<\/p>\n

Chemicals under reduced tarif<\/span>fs include inputs for antiseptics, detergents and medical research.<\/p>\n

Reduced tarif<\/span>fs on coal are timely as the country faces \u201cenergy constraints,\u201d he said.<\/p>\n

Terry L. Ridon, a public investment analyst, said the decision to further lower coal tarif<\/span>fs goes against the government\u2019s policy to phase out coal-f<\/span>ired power plants.<\/p>\n

\u201cWhile it is correct that there are pressures on the price of electricity, it is not solely because of the price of coal,\u201d he said in a Facebook Messenger chat.<\/p>\n

The Philippines in 2020 declared a moratorium on new coal power plants, a move that policy makers including Senate President Francis Joseph G. Escudero have linked to massive brownouts on the main Philippine island of Luzon. <\/span><\/p>\n

Philippine electricity prices are among the highest in Southeast Asia, according to a study by the Ateneo de Manila University\u2019s Department of Economics and Ateneo Center for Economic Research and Development.<\/p>\n

The country\u2019s residential rate was $0.16 per kilowatt-hour (kWh) as of December 2021, compared with Singapore\u2019s $0.18\/kWh, Thailand\u2019s $0.10\/kWh, Indonesia\u2019s $0.10\/kWh and Malaysia\u2019s $0.05\/kWh, it said.<\/p>\n

Mr. Balisacan said the country needs a \u201cbalancing act\u201d in its transition to clean energy.<\/p>\n

\u201cWe cannot immediately and quickly transition to zero emission, otherwise that will also kill our industries,\u201d he said. \u201cBut we are committed to be part of the global effort to reduce emissions.\u201d<\/p>\n

\u201cReducing the tariff of briquette will allow us to produce energy from coal, [which] will be more accessible to our population and particularly our industries.\u201d<\/p>\n

The government should continue to accelerate the transition to renewable energy while using coal to sustain its industries, George T. Barcelon, president of the Philippine Chamber of Commerce and Industry, said by telephone.<\/span><\/p>\n

Mr. Barcelon hopes the NEDA board\u2019s move would boost exports, which he said continue to be hounded by \u201cweaknesses.\u201d<\/p>\n

Also approved by the NEDA board is a proposal to merge tariff lines on certain chemicals and chemical products, textiles, machinery and transport equipment to simplify the tariff structure and ease customs administration.<\/p>\n

Philippine factory activity expansion slowed in May as employment fell for the first time in five months, S&P Global said on Monday.<\/p>\n

Its Purchasing Managers\u2019 Index (PMI) for the Philippines stood at 51.9, down from 52.2 in April, indicating \u201cmodest improvement\u201d in factory activity. A PMI reading above 50 signifies improved operating conditions from the previous month, while a reading below 50 shows the opposite.<\/p>\n

\u2018SAD DAY\u2019
\n<\/b>\u201cThe tariff reductions are only one phase of a medium-term plan,\u201d Ateneo economics professor Leonardo A. Lanzona said in a Facebook Messenger chat, noting that the state should craft midterm employment and skill development plans to boost manufacturing.<\/p>\n

\u201cWhile the plan can increase the gross domestic product, we may end up with a lot of capital-intensive industries,\u201d he said.<\/p>\n

Aside from electricity costs, food prices continue to drive Philippine inflation, which Mr. Balisacan said threatens economic growth.<\/p>\n

Under the tariff program, reduced tariff rates for corn, pork and mechanically deboned meat that started in 2019 would be kept until 2028. Rice tariffs will go down to 15% from 35% until 2028.<\/p>\n

The policy is \u201ca sad day for Philippine agriculture,\u201d the Samahan ng Industriya ng Agrikultura said in a Viber message.<\/p>\n

Rice prices accounted for more than half of Philippine inflation, which quickened to 3.8% in April.<\/p>\n

Inflation likely quickened for a fourth straight month in May to 4%, mainly due to a spike in electricity costs, according to a median estimate of 16 analysts in a BusinessWorld<\/i> poll.<\/span><\/p>\n

Mr. Balisacan said the government aims to stay within the 2-4% inflation target \u201cso that we can go back to the low interest rate regime.\u201d \u201cOnce interest rates start falling, then economic activity will start and will be even more robust.\u201d<\/p>\n

The country\u2019s largest farmers\u2019 groups said in a joint statement reduced tariffs in the past four years on rice from non-ASEAN (Association of Southeast Asian Nations) have not lowered prices.<\/p>\n

\u201cReduced rice tariffs paved the way for more rice imports and yet, rice prices have only gone up,\u201d they said, noting that reduced rice tariffs have \u201cnot benefited consumers\u201d and \u201chave only penalized local producers.\u201d<\/p>\n

They have also deprived the government of much needed revenue, they added.<\/p>\n

\u201cAs with all previous tariff reductions, a new round of tariff cuts will be useless as our foreign rice suppliers simply increase their prices,\u201d said the groups including the Federation of Free Farmers, SINAG and Kilusang Magbubukid ng Pilipinas.<\/p>\n

The Philippines has imported two million metric tons of rice as of end-May, equivalent to 53% of projected imports.<\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

THE BOARD of the National Economic and Development Authority (NEDA) has approved a medium-term plan to lower tariffs on agricultural and industrial products, as the Philippines struggles with rising prices and declining factory performance.<\/div>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"nf_dc_page":"","footnotes":""},"categories":[1],"tags":[115,2267,14644,730,4891,1132,1435,14981,463,12518],"class_list":["post-19077","post","type-post","status-publish","format-standard","hentry","category-uncategorized","tag-amid","tag-board","tag-bworldonline","tag-low","tag-neda","tag-oks","tag-prices","tag-regime","tag-rising","tag-tariff"],"yoast_head":"\nNEDA board OKs low tariff regime amid rising prices - Energy Buzz<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/energybuzz.ph\/neda-board-oks-low-tariff-regime-amid-rising-prices\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"NEDA board OKs low tariff regime amid rising prices - 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