Duterte blames ‘friend’ Trump for Philippine economy woes
But Manila’s central bank disagrees, saying rapid inflation is due to president’s new taxes
Philippine President Rodrigo Duterte on Saturday blamed US President Donald Trump after inflation hit a nine-year high in the Philippines, hurting the image of the populist leader.
It was an unexpected claim from the fiery Duterte, a one-time fierce critic of the United States but who has since embraced Trump after the business tycoon was elected in November, 2016.
When questioned by reporters about the 6.4 per cent inflation in August, a nine-year high that exceeded most analysts’ forecasts, Duterte blamed Trump’s economic policies.
“Who started it? America. When America raised its rates, everyone raised theirs as well. That is how it is. There is nothing we can do,” he told reporters. “Because America … Trump wanted it. Even taxes like excise tax, they raised it. Even import dues.”
Trump imposed duties on Chinese goods as part of the trade war, Duterte said, which prompted retaliation.
Inflation surged to 6.4 per cent in August amid gains in prices of rice and oil. Costs of other goods have also risen after the imposition of higher taxes at the start of the year. Overseas investors are getting rattled by rising consumer prices, a falling peso and political developments, The Philippine Star reported, citing Jose Lim, president at Metro Pacific Investments, one of the nation’s biggest infrastructure companies.
Duterte’s view differs from the central bank, which says inflation was partly due to higher taxes imposed by the government, which drove up food, alcohol and tobacco prices. Tighter supplies of rice due to bad weather and the ongoing lean season also contributed to accelerating inflation, according to Bangko Sentral ng Pilipinas.
He insisted he was not angry at the US or the decisions of its leader, saying: “I will talk to friend Trump … I have nothing against the American people, not the slightest … misgiving against Trump.”
Duterte, who has previously admitted he is not well-versed in economics, did not elaborate on how US economic policies might affect inflation in the Philippines.
The Philippine president, who took office in mid-2016, had previously been criticised by US officials for his bloody war on drugs. But Trump has brushed aside such concerns, hailing his “great relationship”, with Duterte.
Duterte claimed his political opponents are using inflation and higher prices of rice to turn the public against him and support efforts to oust him “that will go into high gear” in October.
He said the forces behind the plot to overthrow him include the Communist Party of the Philippines and Senator Antonio Trillanes, whose amnesty he revoked earlier this week.
Duterte said he will let the Supreme Court decide the validity of his proclamation revoking the amnesty that his predecessor President Benigno Aquino granted to Trillanes for his participation in a coup attempt more than a decade ago against president at the time Gloria Arroyo, one of Duterte’s allies.
Duterte said he “targeted” Trillanes, a former navy officer, based on the recommendations of the solicitor general as he did not fulfil the requirements to obtain the amnesty. He said the pardon is void since the body that investigated and recommended it was also the one that approved it.
Trillanes has asked the Supreme Court to void the amnesty revocation and stop Duterte from putting him back in jail. He has been staying in the Senate building since September 4 to avoid arrest, which the senator said is meant to silence the president’s political opponents and critics.
Agence France-Presse, Bloomberg