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How Philippine economy is badly hit by war thousands of kilometres away
If Marcos government does not go beyond its current limited response, more Filipinos will be pushed into poverty as inflation continues to erode meagre household incomes, economists warn
- PUBLISHED: Wed 27 May 2026, 6:00 AM
Seventy-three year old Daniel Regudo was in a queue to buy cheap rice in front of a government compound in Quezon City when he and others were side swept by a wayward pick-up truck. He died on the spot. An ambulant vendor, hoping to earn extra by plying his wares before dawn, was also injured.
Regudo and other elderlies like him were only hoping to buy 10 kilos of the P20 staple allocated for senior citizens.
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In another incident, a 53-year old mother suffered a heart attack while waiting for financial assistance at the Quezon City Hall compound, a mere kilometer away from where Regudo was struck. Despite efforts to revive the victim, she expired at a nearby hospital. The local government refused to divulge her name for the protection of her family’s privacy, adding they are extending burial assistance and promising to give her youngest child some education assistance.
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Regudo and the mother were part of a familiar sight in many parts of the Philippines since the start of a worsened economic crisis due to the war in the Middle East.
The Ferdinand Marcos Jr. government is sticking to its strategy of selling rice at heavily-subsidised prices or giving one-time cash aids to hardest-hit families, instead of suspending taxes to stave off runaway inflation.
If Marcos does not go beyond his current limited response, more Filipinos will be pushed into poverty as inflation continues to erode meagre household incomes, independent economists have warned.
Vulnerable families
This is the macro economic picture of the Philippines: More than 81 per cent of Filipino families are poor or lower-income, based on government figures. Of the 26.4 million households in the Philippines, an estimated 14.4 million poor and low-income families earn P22,000 (Dh1,350) or less per month. Another seven million lower-middle-income families earn between P22,000 and P36,000 (monthly.
These families, barely above the poverty line, are highly vulnerable to further price increases, in part caused by the prolonged geopolitical hostilities in the Middle East.
Since the war started, local inflation accelerated to 7.2 per cent — the highest in three years — driven by rising food, transport, and utility costs.
Economic growth, meanwhile, slowed to 2.8 per cent in the first quarter, while job generation remains weak, and wages continue to lag far behind the rising cost of living.
Lower-middle-income families could slip into poverty if inflation persists and the government fails to provide meaningful relief, economic think-tank Ibon Foundation said. These are families whose incomes and meagre savings – relentlessly pressured by fuel, transport, electricity, and water price hikes – can be quickly wiped, pushing them into poverty.
They are not, however, included in the Marcos’ government cash aid packages. The administration’s Unified Package for Livelihoods, Industry, Food and Transport (Uplift) program allocates limited amounts to only a limited number of beneficiaries despite the scale of need.
Of over 2.2 transportation workers directly affected by soaring fuel prices since the Strait of Hormuz was closed, only around 1.25 million have received the meager one-time P5,000 (Dh315) cash assistance, while barely half a million have received fuel subsidies. The P1.5-billion assistance package for farmers and fisherfolk is expected to reach only 70,000 beneficiaries out of some 10.9 million listed in the Registry System for Basic Sectors in Agriculture.
Substantial relief needed
Ibon Foundation underscored: “The government needs to go beyond token assistance and adopt measures that provide immediate and substantial relief. These include suspending or removing both excise taxes and value-added tax on oil, imposing stronger price controls against profiteering, legislating a substantial wage hike, expanding subsidies for vulnerable sectors, and rethinking policies that have failed to bring prices down while allowing the country’s wealthiest corporations to reap huge profits."
Millions of Filipinos are just a few more price increases away from poverty. The government must act decisively to lower prices, raise incomes, and deliver meaningful assistance before more families are pushed over the edge, the economists added.
Meanwhile, the Quezon City local government promised to put up more tents to shield people from the heat of the sun while they line up for assistance. No substantial solution, however, is presented to protect poor Filipino families from poverty knocking at the door