Econ team in favor of price control on rice — Pangandaman

THE Economic Team of the Administration of President Ferdinand R. Marcos, Jr. is in favor of the recent imposition of price control on rice through the issuance of Executive Order No. 39.

“This will effectively serve as an “active stop gap” to address the market’s current circumstances. Conditions truly warrant a special mitigating measure,” Secretary Pangandaman said.

“In an ideal scenario, we can let the market dictate prices. However, as NEDA noted, we are now faced with extraordinary factors that we have to consider,” Pangandaman explained.

The Budget Secretary likewise reiterated the unified stand of the Economic Team on the price ceiling, saying that it is indeed a necessary albeit temporary measure to help vulnerable and disadvantaged sectors amidst high prices of rice.

“I join the Chairman and Co-Chairman of the Economic Development Group of the Cabinet in supporting this measure because it is necessary at this time to help those most affected by the otherwise uncontrollable sharp increase in the price of rice,” Sec. Pangandaman said.

The Cabinet’s Economic Development Group is led by Finance Secretary Benjamin Diokno as Chairman, and National Economic Development Authority (NEDA) Secretary Arsenio Balisacan as Co-Chairman.

The Budget Secretary further enumerated certain conditions that entail some form of regulated price caps:

1. Emergency situations: During natural disasters or other emergencies (such as El Niño and typhoons), price ceilings can help prevent price gouging and ensure that essential supplies like food, water and medical supplies remain affordable and accessible to everyone.

2. Temporary measures to address market disruptions: Price ceilings might be viewed more favorably when applied as a temporary measure to address short-term market disruptions (such as hoarding) to provide relief to consumers until the situation stabilizes.

3. Targeting certain sectors to correct market failures: When markets fail to provide essential goods to certain segments of the population, such as the poor or vulnerable, price ceilings can be seen as a corrective measure to ensure these individuals have access to basic necessities.

The issuance of EO No. 39 is in line with the comprehensive approach being implemented by the government to mitigate the concerns of rice retailers and farmers, and to ensure that the rice supply remains sufficient at lower prices and greater competition can sooner be promoted in the rice industry.

“We understand and fully support the decision of the President because there really are market players who have been misbehaving. Unfortunately, there really are hoarders and speculators. We needed to act fast to effectively address this problem with a tit-for-tat strategy against unscrupulous traders, at least in the near-term,” Pangandaman said.