EDITORIAL - Driver of inflation

With the inflation rate still rising, so-called pass-through fees for the transport of commodities have been suspended nationwide. Transport, agriculture and business groups have welcomed the suspension of the fees collected by local government units, barangay offices and police. The government, however, will have to address related issues that are contributing to high consumer prices.

In Metro Manila, at least seven transport groups have announced plans to stage a strike over alleged extortion by local traffic and barangay enforcers in five cities. Meanwhile, an official of the country’s largest business group has said that corruption contributes to the high inflation rate.

The Liga ng Transportasyon at mga Operator sa Pilipinas is seeking Metro Manila mayors’ intervention to stop the reported collection by barangay and local traffic enforcers of up to P5,000 a week for the use of transport terminals, and P20 daily from every jeepney driver for permission to ply the streets. LTOP said drivers were losing from P200 to P300 a day from the collections. The group said a letter sent to Interior Secretary Benhur Abalos got no response; Abalos said he did not see the letter. He expressed readiness to meet with the group.

Meanwhile, the vice president of the Philippine Chamber of Commerce and Industry, Perry Ferrer, estimated that from one to one-and-a-half percent of the 6.1 percent inflation rate in September was due to corruption. Members of the PCCI are mostly operators of micro, small and medium enterprises, which account for over 90 percent of businesses nationwide. Ferrer reportedly gave the assessment during a pre-event briefing for the 49th Philippine Business Conference and Expo to be held at the end of this month. “If you take a look at all the goods [whose prices] are unusually high, these are all due to corruption,” he was quoted as saying.

Last year, a survey among 119 of the country’s top chief executive officers showed that corruption was seen as the top risk to post-COVID economic recovery, trumping surging oil prices and inflation. The survey, conducted online and through physical questionnaires from July to August by the Management Association of the Philippines together with PwC, showed that 67 percent saw corruption delaying economic recovery from the pandemic. The survey showed that the CEOs wanted the Marcos administration to give priority to promoting accountability and transparency, fighting corruption and attracting investments.

Surveys have consistently shown that the Marcos administration is seen to be weakest in managing inflation. Several sectors have cited one of the ways to address the problem: corruption must be curbed.