DTI: Price hikes inevitable due to port congestion
MANILA, Philippines – The Department of Trade and Industry (DTI) admits higher port and other transport charges on imported materials and products will inevitably jack up prices of some commodities.
DTI Undersecretary Vic Dimagiba said traders have to bear additional costs to move their cargo out of congested ports in Manila. But he gave assurances the government would ensure that costs are recovered reasonably.
"We'll ensure upon evaluation that the increase is appropriate on cost per unit," he said.
Meanwhile, in anticipation of heightened demand in the run-up to Christmas, the DTI will issue new suggested retail prices (SRPs) for noche buena products by the first week of November.
Dimagiba warned retailers that they should observe SRPs on basic and prime commodities.
SRPs as of July 2, 2014 still stand and no new SRPs are being planned at the moment.
SRPs are issued by manufacturers to retailers to ensure market share and fair competition in the market. Production and distribution costs, and profit margins of retailers and distributors are factored in. SRPs are regularly monitored by the government to prevent unnecessary price hikes.
Dimagiba said the agency has not received any petition for price hikes.
He said owners and operators of supermarkets, grocery stores, wet markets, and general merchandise stores should comply with SRPs for products classified under basic necessities and prime commodities of the Republic Act 7581 or the Price Act.
Upon evaluation, if retailers are found executing illegal acts of price manipulation such as profiteering, a violation of the Price Act, they shall face an administrative fine of up to P1 million ($22,822.95*) subject to the circumstances provided after due notice and hearing.
They can also be criminally liable for illegal price manipulation that may result to imprisonment of not more than 15 years and a maximum fine of P2 million ($45,642.19).
"We will continue to reinforce our monitoring activities on the prices of basic and prime goods so we can prevent undue price adjustments from retailers. We have added more teams particularly in the NCR because more stores are found here but our regional and provincial offices ensure that they also regularly monitor the markets in their areas," Dimagiba added.
Port decongestion efforts continue
At the Senate hearing session on the port congestion last week, Dimagiba said the DTI took note that the movement of containers from the Manila ports has been heightened in the past two weeks.
The Philippine Ports Authority (PPA) reported that yard utilization at the Manila International Container Terminal and the Manila South Harbor fell to 90% from the high yard utilization of 110% in June brought about by the backlog due to the day-time truck ban.
PPA estimates yard utilization of 70% to 80% by the last quarter of this year.
The government is promoting the Batangas port as an alternative to the congested Manila ports. – Rappler.com