The final figures are now in, and it looks like the Philippine economy is not in good shape. Inflation hit a nine-year-high last month of 6.4 percent.
The Department of Finance revealed the final figures for end-August this week. And I thought that the more or less actual inflation rate of six percent was really bad.
It is by no means hyper-inflation, but this does not give any relief to Filipino consumers who must bear the brunt of rising prices.
Using the figure of six percent which was the initial “guestimate” of the DoF, this means that the cost of goods and services notably basic commodities have risen by this much.
In simple terms, what used to cost P100 now goes for P106. This example may be a bit over-simplified, but it is one that most consumers will understand.
Sad to say, most consumers may not agree. They will argue that the real rate is much, much higher.
Let’s take a look at the most basic of daily needs, transportation. Most Filipinos move from place to place in jeepneys or tricycles. The base fare for a short trip used to be P8. Now, it’s P9.
Simple math tells us that the increase in terms of percentages is 12.5 percent, or more than double the claimed inflation rate of six percent, more or less.
This hike in transportation has a domino effect for the typical Filipino family.
Consider a family which has two kids, both of school age. The father goes to work while the mother takes care of the household.
Father and two kids used to spend P16/each per day going to and from school or work. Now each one spends P18/day. The P2 additional cost is not as minute as it seems. The additional P6/day for the three translates to P30/week or P120/month.
This is no small amount considering that the father’s take home pay is unchanged.
At home, the mother is surprised to learn that the essentials she buys from the market or sari-sari story have all gone up, and not by a mere six percent either.
No, everything she used to buy either daily or weekly has risen, and if she complains to the seller that the government said that prices should only have gone up by six percent, she will be told to buy what she needs from the government instead.
The dominos fall in all directions for the harassed family.
They are told that a typical family should be spending only around P3,000/month to rent a fairly decent house or apartment.
In truth, one cannot even rent a room for this amount, much less an apartment. If the family has a car, parking space in a typical condo is now about P3,000/month.
Where the government gets the figures it releases to the public is anybody’s guess.
To be fair, it may be possible to rent a small house for P3,000, but only in the provinces. The farther one lives from Metro Manila, the cheaper the rent.
But then the cost of transportation will be huge.
So what’s the solution?
The silliest one has been suggested to consumers for decades. Time for a little belt-tightening, they are told.
The average Filipino head of the family has heard this suggestion and recommendation for the longest time, and he knows that it is not just hard, it is impossible.
What has become the norm nowadays is for the father and mother to both be employed, which means that the kids are left to their own devices when mommy and daddy are not home.
This problem is settled by bringing into the household the grandparents, who can at least watch over the kids until the parents get home from work. But this too causes another problem. Not only is more space needed to accommodate lolo or lola (or both), it also means another mouth of two to feed.
And by the way, seniors will typically need not only food and shelter, most will have some medical condition or another that will require what’s called maintenance medication.
But that’s another matter, isn’t it? See, the cost of medicine is not really regulated that much, which means those mean old multinational drug companies are making a killing in such poor countries like the Philippines.
The good news?
Filipino consumers will find ways to survive. Even when the government does little to ease their plight, they always do.