Bu-lat-lat (boo-lat-lat) verb: to search, probe, investigate, inquire; to unearth facts

Volume 3, Number 2              February 9 -15, 2003            Quezon City, Philippines







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GDP Growth Claim Canít Hide Higher Cost of Living

A telling sign of hardship lies in recent estimates of cost of living for a family of six. After all, where can a breadwinner get P16,315.20 ($302.47, based on exchange rate of P53.94 per US dollar) monthly to provide for his or her family's basic needs?

By DANILO ARA—A ARAO 
Bulatlat.com

The impending U.S. war on Iraq has prompted government officials to be more circumspect as regards the country's economy. However, the same old tunes of a better life still appear to inundate official press releases.

In a Jan. 30 statement, Economic Planning Secretary Romulo Neri says that the 5.2% growth in the gross national product (GNP) is the "strongest recorded since the 1997 Asian financial crisis, exceeding the high end of official forecasts."

He stresses that growth of all production sectors surpassed expectations. "We credit this to policies that have created a stable macroeconomic environment in 2002, as well as structural and productivity-enhancing reforms such as the reduction of tariff rates."

Not surprisingly, he argues, "With the economy on a healthy footing in 2002, we see growth being sustained in 2003. GDP is expected to grow 4.2 - 5.2 percent and GNP by 4.5 - 5.4 percent."

By Feb. 5, however, Neri, in announcing recent inflation and consumer price index (CPI) data, admits that the administration "expects inflation to move upward in the coming months due to the impact of the U.S.-Iraq conflict on oil prices and the peso-dollar exchange rate."

That inflation -- an increase in the average level of prices of goods and services -- slightly rose to 2.7% last month compared to 2.6% in December 2002 is a fact that not everybody can relate to, since how this affects cost of living requirements is not properly explained.

By inflating government's cost of living data in 1988 with the current CPI, Bulatlat.com estimates that a family of six in Metro Manila needs P543.84 ($10.08) everyday to meet food and nonfood requirements. In areas outside Metro Manila, a family of six needs P404.78 or $7.50 (agricultural areas) and P425.88 or $7.90 (non-agricultural areas). (See Table 1)

On a monthly basis in Metro Manila, this means that a breadwinner must have P16,315.20 ($302.47) to provide for his family's needs, assuming that the number of members is six. The current minimum wage of P280 ($5.19) translates to a monthly gross pay of only P6,160 ($114.20). (See Table 2)

Since President Gloria Macapagal-Arroyo assumed office, cost of living has continued to increase. In Metro Manila, daily cost of living for a family of six in January 2001 was already high at P500.78 ($9.28) since the minimum wage was pegged at only P250 ($4.63).

Wage increases in Metro Manila amount to only P30 ($0.56) so far, barely enough to cover the discrepancy in wages and cost of living which ballooned for the past two years. Bulatlat.com

 

Table 1 
Daily Cost of Living for a Family of Six
(as of January, in Philippine peso)

 

1997

1998

1999

2000

2001

2002

2003

Philippines

319.11

341.43

380.57

390.55

417.60

433.62

445.17

Metro Manila

383.20

412.44

454.88

464.00

500.78

526.87

543.84

Areas outside Metro Manila

 

 

 

 

 

 

   Agriculture

292.33

312.08

349.16

359.27

382.63

395.39

404.78

   Non-agriculture

307.57

328.34

367.36

378.00

402.57

416.00

425.88

Bulatlat.com computation based on NSO data

 

Table 2
Wages vs Cost of Living in NCR
2001 to 2003 (January, in Philippine peso)

 

On a Daily Basis

On a Monthly Basis a/

 

Minimum
Wage Rate

Cost
of Living b/

Disparity

Minimum
Wage Rate

Cost
of Living b/

Disparity

Jan 2001

250.00

500.78

(250.78)

5,500.00

15,023.40

(9,523.40)

Jan 2002

265.00

526.87

(261.87)

5,830.00

15,806.10

(9,976.10)

Jan 2003

280.00

543.84

(263.84)

6,160.00

16,315.20

(10,155.20)

Bulatlat.com computation based on DOLE and NSO data
a/ Monthly Minimum Wage Rate assumes 22 working days per month
while Cost of Living assumes 30 days per month
b/ cost of living computed on the basis of food and nonfood needs of a family of six

 


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