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Friday, October 17, 2008

PIA Information Services - Philippine Information Agency


PIA Press Release

Gov't doing everything to address high food prices, oil crisis - NEDA

Iloilo City (17 October) -- The government is working non-stop to address the problem on high food and oil prices, which are global ones.

According to OIC Regional Director Ro-Ann Bacal of the National Economic Development Authority (NEDA), the Philippines is not the only country suffering from inflations, as other countries are also suffering from high food and fuel prices.

These facts, among others, were presented by Director Bacal to participants of the recently-held Speakers' Bureau on Food and Energy Security held at the Renewal House, Lapaz, Iloilo City.

According to NEDA, high oil prices happen due to the increasing demand from fast developing countries like India and China, slow down in oil supply growth, speculation on oil prices and supply, weakening of the dollar, and instability in the Middle East, the world's biggest producer of oil.

High food prices, on the other hand, were triggered by the increase in prices of fuel which caused an increase in fertilizer prices. Fertilizer costs make up 30% of total food production cost.

On the other hand, climate change which brings heat waves, droughts and excessive rains damaged crops worldwide. There is also a rush to produce bio-fuels that has reduced lands devoted for food production, global de-emphasis on agriculture in favor of industrial and technical development, and increase in export taxes and imposition of bans and other restrictions on agricultural products by some food exporting countries to keep their domestic prices down.

NEDA also added the economic development in China and India has led to more demands for grain for animal feeds. China's and India's population together account for more than one third of the 6.7 billion world population.

Through all these, NEDA said the government is doing everything to address these problems.

Primary among its concerns are ensuring food security, promoting energy security, stabilizing prices of other commodities, providing subsidies to the poorest of the poor, and implementing austerity measures.

Ensuring food security starts with ensuring increased farm production, and the government is pushing the FIELDS program, or Fertilizer, Irrigation and Infrastructure, Education and Extension, Loans and Insurance, Dryers and other post-harvest facilities, and Seeds, with a budgetary fund of P43.7 billion targeted to attain rice self-sufficiency by 2010.

For Region 6, P167.9 million is being allotted for fertilizer subsidy to farmers for the wet cropping season (May to October 2008), according to NEDA, which translates to P250 per bag of fertilizer at a maximum subsidy of P500 per hectare. On the other hand, P327.1 million had been allocated by the government from regular and augmentation funds to National Irrigation Administration 6 in 2007 for restoration and rehabilitation of small irrigation facilities serving 4,468 hectares of farmland and 12,430 hectares still ongoing.

As of June 30, 2008, P150.5 million had been allocated for small irrigation facilities in Region 6 for 1,934 hectares of farmland restored and 10,596 hectares rehabilitated. Some 231 kilometers costing P231 million of farm-to-market roads are targeted to be rehabilitated in Region 6 while P84 million had been allotted for the establishment of 120 unit flatbed dryers in the region and P88 million allotted for seeds assistance to farmers in the region translating to 335,872 bags.

The issuance of Presidential Administrative Order 226 on May 16, 2008 suspending for two years the processing and approval of all applications for conversion of rice lands is another factor seen to ensure food security in the country. The DA and House of Representatives have also a MOA on a P1 billion congressional funding for rice and corn productivity program, and the opening up of rice importation to the private sector.

On the part of the National Food Authority, NEDA reported that the food agency had a doubling of NFA rice importation from 150,000 MT to 300,000 starting June 2008. In Region 6, NFA continues to field rolling stores and distribute government rice at P18.25 per kilo, P13.49 million had been allocated in 2008 for repair of mechanical dryers, improvement and repair of warehouse sites, and retrofit the biomass furnace to maximize NFA operation.

On other agricultural products, the government is undertaking the following to ensure sufficient and affordable supply: opening of Barangay Bagsakan Centers (BBCs) and Programang Gulayan ng Masa implemented by 10,535 households and 5 school divisions.

In promoting energy security, the government has tapped indigenous energy resources with favorable results, like in the Galoc Oil Field in Palawan, which has started producing some 17,000-23,000 barrels of oil per day beginning mid-June 2008; aiming to double indigenous oil production to over 31,000 barrels of oil per day; increase local oil production to 10% of total demand, up from approximately 4% and save the country US$1.4 billion (P59 billion) from oil imports.

From the P4 billion Katas ng VAT program of the government, P1 billion will be allotted for energy security. The government is also promoting the use of Compact Fluorescent Lights (CFL) - with P500 million to be allotted for the promotion of CFL and LED bulbs by DOE.

A shift to alternative fuels and renewable energy is also being promoted, with Panay being a laboratory for renewable energy projects. There is also a move to fast-track implementation of the following indicative power plants in Region 6: 15 MW capacity Biomass Project - Central Azucarera de San Antonio in Passi City (2 MW ready for sale); 1 Biomass project in Talisay, Negros Occidental on the pipeline stage; Bio-ethanol Project in San Carlos, Negros Occidental with 100,000 liters capacity/day (ongoing); 25 MW Capiz Bio-Energy; 14 MW Hydropower Project in Villaciga, Bugasong, Antique; 40 MW Hydropower Project in Timbaban, Madalag, Aklan; 100 MW Coal Fired Power Plant in Concepcion, Iloilo; 164 MW Coal Fired Power Plant in Iloilo City; 40 MW Northern Negros Geothermal Expansion in Mambucal, Negros Occidental; 30 MW San Carlos Wind in Sand Carlos City, Negros Occidental; 20 MW Pandan Wind in Pandan, Antique; 10 MW Caticlan Wind in Caticlan, Malay, Aklan; and 10-20 MW wind power by Trans-Asia in Guimaras.

Another way the government is doing to help the people is the stabilization of prices of commodities through the DTI, DA, DOH and DENR which continuously monitor prices and supply of basic and prime commodities under their jurisdiction as stated in the Price Act (RA 7581).

The government is also providing subsidies to the poorest of the poor through the Tindahan Natin outlets throughout Western Visayas which has a total of 658; and increasing subsidies to the NFA to bring down the cost of rice to P18.24 per kilo. NFA is also buying palay from our farmers at P17/kilo to encourage them to plant more rice.

The government has many other programs to help the people cope with the high prices of food and oil, like the food for school program, Botika ng Barangay, Self-employment Assistance - Kaunlaran, KALAHI-CIDSS, KATAS ng VAT (P4 billion) with P2 B for energy subsidy and P1 B for education through scholarships, and Scholarship programs by CHED.

In the government's implementation of security measures, Administrative Order s. of 2008 "Addressing the Rising Cost of Energy" requires government agencies to adopt energy saving measures: 10% reduction on government fuel consumption; turning-off airconditioners at 4:30 p.m.; replacement of all incandescent bulbs; conversion of 20% of agency vehicles in major cities to liquid petroleum; and installation and/or adoption of other energy saving technology with the help of the DOE and/or DOST.

How can we, as Filipinos, help our country weather the global storm? NEDA has these suggestions: Practice energy conservation at home, in our workplace, and in our community; help stabilize rice and food demand by not stockpiling on supplies and commodities; help monitor and report food hoarding and price manipulation to concerned authorities; avoid unnecessary expenditure and loans; do our part in revenue generation and tax collection by asking for official receipts and reporting tax cheats to the DoF and the Ombudsman; report non-issuance of OR to the BIR through email complaints or email the Revenue Integrity Protection Service of the Department of Finance.

In doing these things, Filipinos will be doing their share to help the government weather the crisis which is not only affecting this country but the rest of the world. (PIA) [top]

PIA Information Services - Philippine Information Agency

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