MANILA – Sectors currently receiving fuel subsidies from the government will continue to get respite from the sustained increase of fuel prices, Finance Secretary Benjamin Diokno said.
“We will continue the grant of the fuel subsidies to the affected parties like the drivers, the farmers, and the fisherfolk,” he said during a briefing at the Palace.
The government provided targeted subsidies amounting to PHP6,500 to lessen the impact of the surging oil prices on the affected sectors.
It has budgeted around P6.1 billion for this program for the transportation and agriculture sectors.
Diokno said funds for the fuel subsidy will come from windfall tax, adding the current depreciation of the peso resulted in higher-peso value of oil imports thus, higher taxes for oil and fuel products.
He said since jumps in domestic inflation rate are not only due to higher oil prices but also supply issues for several products, like meat and fish, the government will also continue to import products that are facing supply constraints.
“And of course we will try to improve the transportation and logistics sectors,” he added.
The increase in oil prices in the international market has affected domestic oil prices, as well as those of other commodities like food.
It has also resulted in second-round effects like the increase in minimum fare around the country.
Last June, inflation rate further accelerated to 6.1 percent from month-ago’s 5.4 percent, bringing the year-to-date average to 4.4 percent, higher than the government’s 2-4 percent target band
The Bangko Sentral ng Pilipinas (BSP) forecasts the average inflation this year to be at 5 percent and at 4.2 percent and 3.3 percent in the next two years. (PNA/PN)
