The National Economic and Development Authority (NEDA) attributed the improvement in poverty incidence to a faster increase in real incomes, compared with the rise in prices.
The latest poverty incidence was based on estimates using the income data from the Family Income and Expenditure Survey (FIES) conducted in July 2015 by the PSA.
Poverty incidence refers to the proportion of people below the poverty line to the total population during the period.
In a statement, Socioeconomic Planning Secretary Emmanuel Esguerra said growth in the average nominal per capita income accelerated to 15.3 percent in 2012 to 2015 from 12.8 percent in 2009 to 2012.
Inflation decelerated to 9.5 percent in 2012 to 2015 from 12.1 percent in 2009 to 2012.
On the other hand, subsistence incidence among Filipinos, or the proportion of Filipinos whose incomes fall below the food threshold, was estimated at 12.1 percent in the first semester of 2015, lower that the 13.4 percent in 2012.
Subsistence incidence among Filipinos is often referred to as the proportion of Filipinos in extreme or subsistence poverty, the PSA said.
“This means that the proportion of families that do not have enough income to meet basic food requirements has been declining,” Esguerra, who is also the NEDA director general, said.
Meanwhile, the survey said a family of five needed at least P6,365 on average every month to meet their basic food needs.
‘Poverty cut could have been better’
Agreeing with the government, University of Asia and the Pacific economist Victor Abola said the increase in real income accounts for much of the improvement in poverty incidence.
But while this is good news, he noted that the poverty rate has remained fairly flat for the past years.
“In short, faster economic growth has not been sufficient to reduce poverty more significantly,” he said, noting that job creation remains weak especially because of an overvalued exchange rate.
Limit the peso’s strength
With this, Abola said the government should not allow the peso to weaken by building up buffers, particularly dollar reserves.
“Do not allow the peso to appreciate. It is making hot money managers richer and poor Filipinos unemployed. How? Build up our gross international reserves [GIR] more aggressively. After all, GIR is financial wealth of a country,” he said.
More needs to be done
“The increase in income was still not enough to offset the increase in food prices, particularly those that are being consumed more by the poor. In particular, the price of rice, which declined in 2015 relative to its 2014 levels, has remained high; actually almost 20 percent higher than its price in 2012,” Esguerra explained.
Moving forward, he said, the government remains committed to enhancing efforts to further reduce poverty and inequality.
“We will continue to implement our three-pronged strategy of one, growing the pie, two, improving the distribution of the benefits of the pie and three, building up socioeconomic resiliency,” he said.
“We need to cultivate an atmosphere where businesses and private investments could thrive, so that more employment opportunities are created,” he said.
Nevertheless, Esguerra said the NEDA expects the full-year poverty incidence will be lower than the 26.3 percent recorded in the first semester of 2015. “The full-year estimate is between 23.6 percent and 23.8 percent. This is close to the high-end target of 20 percent to 23 percent for 2015,” he said.