FEDERATION of Philippine Industries (FPI) chairperson Elizabeth Lee on Monday thanked the government for rolling back the escalating prices of pump fuel.
“We commend the government for its swift action and implementation. This rollback, particularly the diesel correction, will provide immediate operational relief [to the country‘s manufacturing industry],” Lee said in a statement.
In a video message on Sunday, President Ferdinand Marcos Jr. announced that diesel is expected to drop by at least P20 per liter, gasoline by P4.43 per liter, and kerosene by P8.50 per liter.
The rollback takes effect today, April 14.
But while Lee sees it as good news, she noted that the price drop is due to “geopolitical circumstances, not structural reform.”
The situation can change quickly and fuel prices can go up again next week, if the US-Iran ceasefire talks collapse and the war persists, Lee said, pointing out that “the ceasefire is time-bound, and we don‘t even know if it will hold. Volatility remains.”
Manufacturers have suffered from higher expenses at every stage of the value chain, spanning the procurement of raw materials, factory operations, and last-mile distribution, Lee said.
“The series of price hikes is an extraordinary cost burden that compressed margins across food processing, chemicals, packaging, textiles, construction materials, and virtually every energy-intensive sub-sector,” she explained. “[Even with the rollback], diesel prices remain far from pre-war levels.”
Lee laid down a list of long-term measures that government should adopt:
– Strengthen “Buy Local” strategy
By prioritizing domestic inputs and supply chains, the country can reduce import dependence, stabilize production costs, and create more predictable sourcing conditions for manufacturers, supporting local enterprises, particularly MSMEs, while retaining value within the economy, sustaining employment, and strengthening the capacity to withstand global disruptions.
– Target support
Targeted, time-bound support should complement tax measures by assisting employed workers and firms in the most affected sectors — particularly MSMEs and energy-intensive industries such as manufacturing — by institutionalizing fuel subsidy.
– Transport electrification
To accelerate the shift to electric vehicles in public transport, the Philippines can draw lessons from international models, such as Singapore‘s gross cost contracting, while adapting them to local realities.
– Fast-track renewable and alternative energy investments such as solar adoption through concessional financing, priority lending, and existing investment incentives that can significantly reduce upfront costs for households and businesses.
“If and when [the Iran war] is resolved, resulting in lower fuel prices, we may see reduced freight and logistics costs filter through supply chains down the line, perhaps within weeks from the positive resolution of the conflict, with downstream effects on input prices, inventory carrying costs, and potentially, retail price stabilization for consumer goods,” Lee said.
