Price pressures signal need to reform power, logistics industries, FPI says

THE Federation of Philippine Industries (FPI) said reforms are needed in the power, logistics, and food industries to ease the price pressures affecting manufacturing activity.

“Industry is operating in a tight environment marked by elevated costs and cooling demand. Stability and clear reforms will determine whether we can turn these pressures into a more competitive industrial base,” FPI Chairperson Elizabeth H. Lee said in a statement on Monday.

She noted that while inflation eased in May, cost pressures remain, with core inflation still high.

Headline inflation eased to 6.8% in May amid slower price hikes in transport, fuel, and energy-related utilities, the Philippine Statistics Authority said last week.

Core inflation, which does not include volatile food and energy prices, accelerated to 4.1% in May from 3.9% in April.

High core inflation denotes that price pressures are still spreading across the economy, Ms. Lee said.

She noted that manufacturers continue to face elevated energy and logistics costs, imported input inflation, and wage pressures while households deal with rising food prices.

Softer domestic demand is also weighing on non-essential manufactured goods, while higher interest rates make working capital and capital expenditure financing more expensive, Ms. Lee added.

The FPI also called on senators to focus on pushing legislative reforms to prevent the erosion of investor confidence.

“Political realignments happen. What businesses need is continuity in economic policy,” Ms. Lee said.

The Senate is currently in the middle of a leadership crisis, which delayed proceedings last week.

“Clear priorities on energy, logistics, and competitiveness will reassure both local industry and foreign investors,” Ms. Lee added. — Beatriz Marie D. Cruz