Finance Secretary Benjamin Diokno held a press conference April 4, 2023 to provide updates on the Inter-agency Committee on Inflation and Market Outlook (IAC-IMO)’s strategies to mitigate inflation in the country.
The creation of the IAC-IMO was approved in a sectoral meeting on March 7, 2023 by President Ferdinand Marcos, Jr. as a proactive measure to fight inflation. It serves as an advisory body to the Economic Development Group (EDG) on measures that will keep inflation, particularly on food and energy, within the government’s target range.
The Committee is in charge of closely monitoring the main drivers of inflation, assessing the supply and demand of essential food commodities, monitoring external and internal shocks, facilitating data-sharing among concerned agencies, and providing timely recommendations to curb price spikes.
It also regularly monitors data such as farmgate, wholesale, and retail prices; volume of local production and area harvested/planted; stocks inventory; sanitary and phytosanitary import clearance issuances and actual import arrivals; geospatial, climate, and satellite data; and damage and losses due to calamities and disasters, which are necessary to assess food prices and the supply-demand situation.
The IAC-IMO is co-chaired by the Secretaries of the Department of Finance (DOF) and the National Economic and Development Authority (NEDA), while the Secretary of the Department of Budget and Management (DBM) serves as the Vice-Chairperson.
Members of the IAC-IMO include the Department of Agriculture (DA), Department of Energy (DOE), Department of Science and Technology (DOST), and Department of Trade and Industry (DTI). The DOF serves as the committee’s Secretariat.
Secretary Diokno shared that NEDA Secretary Arsenio Balisacan convened the IAC-IMO in a roundtable discussion on April 3, 2023 for a rundown of strategies to streamline data-gathering tools for the conduct of timely analysis in mitigating inflation.
To provide additional information on the local production of key commodities, the IAC-IMO will be tapping advanced technologies to complement traditional modes of data and analysis. This will allow the Committee to submit a complete and detailed assessment of the country’s market outlook.
“[B]ased on our initial scoping and conversations with different agencies, there are various frameworks and tools that use satellite imagery to analyze demand and supply of key commodities,” Secretary Diokno said.
Three tools were discussed during the meeting.
First is the Philippine Rice Information System (PRiSM) which is an operational system for nationwide rice monitoring that identifies the scale and magnitude of production gaps in rice.
With the use of Earth Observation technologies, crop growth simulation models, and information technology, PRiSM provides timely information on rice area; start of season maps or planting dates; yield estimates, mid-season forecast, and end of season yields; and extent of area affected by flood or drought.
The project is already institutionalized and housed within the Philippine Rice Research Institute (PhilRice).
Second is the Project Smarter Approaches to Reinvigorate Agriculture as an Industry (SARAI) in the Philippines – an action-research program that provides agricultural stakeholders with site-specific advisories in order to mitigate climate risks.
Project SARAI provides in-season crop forecasts and yield estimates; assessment of droughts and availability of rainfall; and crop advisories on how to maximize crop growth while addressing potential pest or disease problems.
Finally, the Data Analytics Technologies and Operation Services for Space Data (DATOS) project developed by the DOST-Advanced Science and Technology Institute (ASTI) uses remote sensing, space technology, and data science applications to support critical activities on disaster mitigation, analysis, and advice.
The Philippine Space Agency (PhilSA) also uses satellites for disaster risk management, defense and security, and planning and econometrics.
“We want to introduce science into decision making and that’s what we’re going to do,” Secretary Diokno said.
At present, the IAC-IMO is in close coordination with the Philippine Statistics Authority (PSA), Philippine Space Agency (PhilSA), DOST – ASTI, and various government agencies in order to apply advanced science and technology into their assessments.
“We need to increase production domestically and we need to increase productivity in agriculture because if we compare our agricultural output with other countries, we are way behind,” Secretary Diokno said.
The IAC-IMO will continue to hold technical level meetings throughout April to assess the drivers of food and non-food inflation and recommend policies to mitigate the impact of inflationary pressures. The principals-level IAC-IMO is scheduled to meet by end-April, while the first EDG meeting will be conducted on April 26, 2023.
