Declaring state of calamity will temper inflation brought by Ompong — NEDA

The National Economic and Development Authority (NEDA) said Friday a declaration of state of calamity in areas affected by Typhoon Ompong will temper the expected inflationary impact of the weather disturbance.

"A declaration of state of calamity can temper inflation,"  Socioeconomic Planning Secretary and NEDA chief Ernesto Pernina said on the sidelines of the AskNEDA media briefing in Pasig City.

During the briefing, NEDA Undersecretary Adoracion Navarro said that while it is still difficult to predict the exact impact on inflation of Ompong, what the government can do is to manage expectations.

"Inflation is driven by inflation expectations and declaration of State of Calamity is one measure," Navarro said.

"Our recommendation to declare a state of calamity is a manifestation of the government's swift action," she said.

Among the price control measures to be imposed once the President declares a state of calamity are the imposition of price ceiling on basic necessities and prime commodities will be imposed; and the monitoring, prevention, and control of overpricing/profiteering and hoarding prime commodities, medicines, and petroleum products.

The Department of Agriculture estimated the damage incurred by the agriculture sector from Ompong has reached P16.76 billion. 

Damages on agricultural produce could disrupt food supply and eventually cause prices to go up. 

Navarro said the National Disaster Risk Reduction and Management Council (NDRRMC), in a special meeting on Thursday, has established that conditions necessary to declare a state of calamity in Ompong-hit Regions I, II, III, and Cordillera Administrative Region (CAR) are present.

"The resolution will be sent to the Office of the President within the week," she said.

The government can also tap the $500-million standby loan facility from the World Bank once the state of calamity is declared. — RSJ, GMA News