President Marcos Jr. on Tuesday called on all governments to “unwind any trade restrictions and reinforce the commitment to the World Trade Organization (WTO) reform amid the global inflation.”
The President, during the Country Strategy Dialogue at the World Economic Forum (WEF) in Davos in Switzerland on Tuesday, everyone has seen that inflation has been accelerating globally in recent months making it “appealing” for nations to pursue protectionism policies to cushion its impact.
“We are mindful that while protectionist policies may be appealing, even necessary in the short term, there will ultimately be no long-term winners… We join the call for all governments to unwind any trade restrictions and reinforce our commitment to the World Trade Organization (WTO) reform,” Marcos said.
He added countries should instead ensure there are sufficient welfare measures that will cushion the impact of elevated inflationary pressures, especially towards the most affected and vulnerable sectors.
In addressing the impact of current geopolitical risks, the President suggested the timely and effective delivery of practical, workable outcomes and encourage economies to leave no stone unturned in finding common ground in these critical global issues.
As this developed, International Monetary Fund (IMF) managing director Kristalina Georgieva commended Marcos for his leadership amid the numerous “more immune and more complex challenges” faced by the Philippines.
Georgia said the Philippines has been “exceptionally well-performing…in the last year of turbulence to sustain growth.”
She affirmed the IMF’s readiness to help countries like the Philippines, in achieving sustainable growth and pushing for economic policies that would benefit more Filipinos.
The President, for his part, said there is a need to “go back to the basics” to be able to address certain problems such as those affecting food supply.
“We also have to go back to the basics because there are weaknesses in different systems like in food supply, like in energy, infrastructure, climate change… these are the basic problems that we need to be addressing,” Marcos said.
Meanwhile,state think tank Philippine Institute for Development Studies (PIDS) in a study said the government must pursue trade liberalization and other cost-effective policies over price subsidies to make food more affordable to Filipino consumers.
Rather than implementing financially unsustainable price subsidies, liberalization measures to improve food affordability is more cost-effective and ought to be pursued aggressively by government when nutrition security is under threat, said PIDS senior research fellow Roehlano Briones, author of the report, Food and Nutrient Intake Response to Food Prices and Government Programs: Implications for the Recent Economic Shocks.
Prior to the pandemic, the nutritional status of Filipino children was already a serious concern. Adding to the recent rounds of food price inflation, Briones said these economic shocks are likely to have an adverse impact on food consumption and nutrient intake at the household level, leading to worsening nutritional status.
The food groups that contribute most to the Filipinos’ energy, protein and micronutrient intake, including rice, cereals, fish, meat and poultry, are all produced under high levels of trade protection against cheaper imports.
According to Briones, this has the unfortunate consequence of reducing the affordability of nutrient-rich foods.
“The sooner the government dismantles high tariffs and overly strict (and often arbitrary) application of sanitary and phytosanitary standards on these major consumer goods, the more affordable these items become, especially to the poor,” he said. Jocelyn Montemayor and Angela Celis
