Press Release
January 4, 2006


Sen. Mar Roxas yesterday said the government should face the challenge of translating the countrys positive gains in the financial markets into tangible benefits that will uplift the living conditions of ordinary people.

Roxas, chairman of the Senate Committee on Trade and Commerce, said Filipinos have yet to gain from the appreciation of the local currency against the US dollars in the past few months such as experiencing lower prices of prime commodities.

Manufacturers often cite the increasing costs in importing raw materials brought about by the weakening Philippine peso as the reason to justify price increases of basic goods, but they have yet to rollback their prices now that the peso has strengthened against the US dollar, said Roxas, who previously served as trade secretary.

Based on the latest monitoring report by the Department of Trade and Industry, prices of processed milk in December 2005 remained higher by 5% to 8% as compared to their prices in December 2004.

On the other hand, the Philippine peso has reached a 32-month high of P52.57 against the US dollar early this year, which is lower than its average exchange rate of P56.18 against the US dollar in December 2004.

Roxas, chairman of the Senate Committee on Economic Affairs, also pointed out that the continued drop in interest rates have not been felt by ordinary consumers who continue to pay high interest for their car loans, appliance loans, credit card loans, and others.

The 91-day benchmark Treasury bill fetched a rate of 4.961 percent, or almost 300 basis points lower than 7.87 percent in January 2005. Banks and financial institutions determine their interest rates based on the movements of the 91-day T-bill rate.

According to Roxas, the strong growth in the financial economy is not matched by the growth in the real economy. Even if people have more money as indicated in the increasing OFW remittances, he said Filipinos are neither spending it nor investing their savings.

Businessmen have been complaining about sluggish sales because people prefer to hunt for bargains in flea markets rather than buying goods from retail establishments, he said. Consumers are willing to bear the heavy traffic in areas like Divisoria to buy cheaper goods.

News Latest News Feed