Trade officials inspect the prices of prime commodities at a mall in Davao City. Mindanews file photo
DAVAO CITY (MindaNews / 10 November) – The high inflation rate in Davao City must be managed to hasten the recovery of the local economy that has been severely affected by the coronavirus disease (COVID-19) pandemic, a business leader said.
John Tria, vice president of the Davao City Chamber of Commerce and Industry Inc., said during “Wednesdays Habi at Kape” that the growing inflation rate concerns the business owners as the increase in the prices of basic commodities would have a snowball effect on demand and ultimately on the growth of local establishments.
He said the inflation beginning early this year was seen as “transitional” as consumers were in a “revenge spending” following the easing of COVID-19 restrictions, which drove the demand and prices of goods up.
“How to lower inflation is going to be the biggest challenge because again when prices go up, the challenge is how to keep your customers buying at the same volume to ensure your own growth,” he said.
Tria said that it seems the current inflation is not anymore “transitional” at the rate the consumer price index is growing.
He said it remains unclear when it would go down.
“I think inflation is a big concern because when costs are high, they (businesses) are forced to raise prices. When they raise prices, less people can afford. That’s why it’s important to manage inflation because its domino effect needs to be managed,” he said.
The Davao Region posted an inflation rate of 9.8% in October, the highest among 17 regions in the country, according to a report released by the Philippines Statistics Authority (PSA) last November 4.
Based on the Summary Inflation Report Consumer Price Index (CPI), the agency said the inflation rate further accelerated from 9.6% reported in September in the region composed of the provinces of Davao de Oro, Davao del Norte, Davao del Sur, Davao Occidental, Davao Oriental, and Davao City.
The PSA said the increase in inflation rate in the region was largely contributed by the movement in the prices of alcoholic beverages and tobacco at 12.2% from 10.3% in September, and food and non-alcoholic beverages at 11.[]
7% from 10.5% in September.
Tria said restaurants, for example, would be forced to raise prices as a result of the high input costs, and this would be passed on to consumers.
According to the PSA, clothing and footwear reported a slight increase in October at 4.[]
7% as against 4.4% in September; furnishings, household equipment, and routine household maintenance at 6.5% from 5.9%; and health at 5.3% from 5% in the region.
However, the cost of housing, water, electricity, gas, and other fuels decreased from 9.[]
