Government scrambles amid oil crisis
Duterte could ask Congress to study the state of economic emergency
President Rodrigo Duterte plans to call a special session of Congress to discuss a possible state of economic emergency and other recommendations from his cabinet to mitigate the impact of the Russian invasion of Ukraine on the Philippine economy .
Senators backed calls on Tuesday for a special session to declare such an emergency, although Energy Secretary Alfonso Cusi – a member of Duterte’s economics team – said it was not yet necessary to do so. do, despite the ongoing war in Ukraine which has pushed oil prices to unprecedented levels.
“The government does everything. We are working together,” Cusi said, while acknowledging that gasoline could reach 100 pesos per liter if the rise in global oil prices does not subside.
At the palace briefing on Tuesday, acting presidential spokesman Martin Andanar said a “total war” or “world war” could trigger the declaration of an economic emergency, which would be investigated by the Office of the executive Secretary.
Duterte’s economic team on Monday proposed government interventions to mitigate the effect of rising fuel prices and the Ukraine-Russia conflict on the country, Andanar added.
“The full Cabinet and the security cluster, the economic cluster will have to meet on this subject. And of course, the president will be the one chairing this meeting… Well, that’s not the case yet,” he said.
In his “Speak to the People” public address, Duterte said the special session aimed to adopt interim measures to cushion the effects of the war in Ukraine, which includes soaring fuel and commodity prices.
Duterte admitted there might not be enough time to tackle all the measures as he has less than three months left in his term.
“Let’s be frank with Congress. This is meant really for people’s well-being. If you have time, sit down with us and we can discuss it. Otherwise, you are on your own,” Duterte said.
“It is much better… let us study the situation…. you know, so there’s going to be an election, and after that, it’ll be euphoria. So no one really focuses on anything other than the changing of the guard…. So it would take a long time,” the president said.
“NEDA Recommendations [are] really vital…to keep the economy going for a few months,” he said, referring to the National Economic Development Authority.
During the Cabinet meeting, the Secretary for Socio-Economic Planning, Karl Chua, proposed to the President the lowering of tariff rates for pork and the increase of fuel subsidy and vouchers for truck drivers. transport and farmers, and the nationwide move to the loosest COVID 1 alert level, to keep prices constant.
“In terms of tariff reduction, since Congress is not in session, we will submit a request for an executive order to be issued. Only two laws are needed, [so] we will prepare it immediately so that Congress can consider it immediately when it returns in May for a session,” he added.
Congress is adjourned until May 22 to accommodate the election period that began February 9.
Finance Secretary Carlos Dominguez III also said Monday evening that even if the conflict between Russia and Ukraine does not directly involve Filipinos, the Philippine economy will still be “probably collateral damage”.
“It’s as if we were hit by a ricocheting bullet,” Dominguez said in his report to the president. “These indirect shocks will likely be felt through four main channels: the commodity market, the financial market, investments, and the impact on our fiscal health.”
Dominguez said oil and food prices are expected to rise as Russia is the biggest exporter of natural gas and wheat, while Ukraine is the fourth largest exporter of corn.
Senate President Vicente Sotto III said that if the president calls a special session, he will have to call the chamber.
Senate Pro Tempore Speaker Ralph Recto also backed calls for a special session to deal with rising prices, especially of fuel and electricity, and to help those in need.
Presidential candidate Sen. Panfilo Lacson said if Duterte called a special session, they had to comply. “Whether or not I support the declaration of the state of economic emergency will depend on the proposal that will be submitted by Malacanang,” he said.
Another presidential candidate, Senator Manny Pacquiao, stressed the urgency of holding a special session to specifically pass measures that would suspend value-added taxes or excise taxes on petroleum products. He said he was prepared to take time off from his campaign to attend the session.
Also in the Senate:
• Senate Minority Leader Franklin M. Drilon said he sees no legal impediment that would prevent the Treasury Department and the Office of Internal Revenue from suspending the collection of fuel excise taxes to cushion the impact of astronomical increases in the prices of petroleum products. . He said the TRAIN law should be interpreted liberally given the current situation.
• Senator Grace Poe urged the government to act quickly to distribute aid to utility drivers and farmers who are suffering from rising fuel prices.
• Senator Juan Miguel Zubiri also pleaded for the suspension of the excise tax on petroleum products in a context of soaring fuel prices. He also called for stricter implementation of the biofuels law to boost the use of alternative fuels.
Meanwhile, former Foreign Secretary Albert del Rosario urged the government to “take concrete steps” to contain the fallout from Russia’s invasion of Ukraine, including the immediate repatriation of 5,000 Filipinos working in Russia. and in neighboring countries of Ukraine.
“The fall of the Russian ruble now renders remittances from these OFWs worthless,” Del Rosario said of Filipinos working in Russia. “Worse, Russia’s deteriorating economic situation, as a result of Western sanctions, puts the lives of these OFWs at risk.”
The former ambassador also suggested that the government should now take the development and extraction of energy from Reed Bank and other Philippine energy sources even more seriously.
“The looming energy crisis in our country has been exacerbated not only by the depletion of reserves in the Malampaya gas field, but also by the inevitable global energy shortage resulting from Western sanctions against Russia. “, said Del Rosario.