Bu-lat-lat (boo-lat-lat) verb: to search, probe, investigate, inquire; to unearth facts
Volume 3, Number 15 May 18 - 24, 2003 Quezon City, Philippines
of April 2003:
In early May, the Macapagal-Arroyo administration stressed that the single-digit inflation rate slowed down, an indicator that the economy is well on its way to recovery. How true is this?
DANILO ARAŅA ARAO
Based on latest figures released by the National Statistics Office (NSO), the inflation rate slightly dropped to 2.8 percent in April compared to the previous month's 2.9 percent.
As in the past, the Macapagal-Arroyo administration was predictably mum on the state of the people's purchasing power which may be extrapolated from the consumer price index (CPI).
The CPI measures the cost of a market basket of consumer goods and services. It is the basis for computing the inflation rate, which is defined as an increase in the average level of prices of goods and services.
On the other hand, purchasing power refers to the buying capacity of a currency compared to a given base year. The national government currently uses 1994 as the CPI's base year.
Based on April 2003 data, the purchasing power of the peso is pegged at P0.5875 (or US$0.0112 based on exchange rate of P52.34 per U.S. dollar) nationwide. In Metro Manila and in areas outside Metro Manila, the purchasing power of the peso amounts to P0.5764 ($0.0110) and P0.5921 ($0.0113), respectively.
Given that the base year is 1994, a person only needed 59 centavos ($0.0113) eight years ago to buy goods and services that are currently worth one peso today. The Autonomous Region in Muslim Mindanao (ARMM) currently has the lowest purchasing power of the peso at P0.5225 or $0.0100. (See Table)
It is interesting to note that in two years, there is a four-centavo reduction in purchasing power. In Metro Manila and Northern Mindanao, the decrease is five centavos.
The state of purchasing power has dire implications on workers' wages. The current daily minimum wage in Metro Manila, for example, amounts to P280 ($5.3496). However, its real value is only P161.39 or $3.0835 (i.e., P280 x P0.5764). The same is true for other regions where already low wages are further reduced by the increasing prices of goods and services.
Indeed, current official statistics tend to muddle social reality, and official press releases only get confined to praises, miserably failing to give the entire picture. Bulatlat.com