In separate statements issued on March 1, the Cebu Chamber of Commerce and Industry (CCCI), the Mandaue Chamber of Commerce and Industry (MCCI), and the Talisay City Chamber of Commerce and Industry (TCCCI) said the unrest in the Middle East would drive fuel prices up, triggering higher power rates, transportation costs, and prices of basic goods and services.
Carl Cabusas, TCCI president, urged policymakers to implement proactive measures to cushion the impact of global oil price volatility on local enterprises.
“Support mechanisms, fuel stabilization strategies, and supply chain interventions will be crucial in protecting both businesses and consumers,” he said.
Jay Yuvallos, CCCI president, called on government agencies to closely monitor inflationary pressures, ensure energy supply stability, and provide timely support mechanisms for MSMEs should conditions worsen.
Yuvallos pointed out that MSMEs, which comprise the vast majority of businesses in Cebu and the Philippines, would be particularly vulnerable to sudden increases in operating costs, fluctuating demand, and supply chain interruption with their thinner margins and limited buffers.
He said access to working capital may also tighten if financial markets react negatively to prolonged geopolitical instability.
“While the situation remains fluid, preparedness and prudence will be key. Cebu’s business community has demonstrated resilience through past crises: from global financial shocks to the pandemic, and we are confident that with coordinated action and sound planning, we can mitigate risks and safeguard economic stability,” Yuvallos said.
Impact on logistics costs
Barbara Gothong-Tan, MCCI president, said damage to oil and gas infrastructure and disruptions to major shipping routes in the Persian Gulf would affect global oil supply and drive up prices worldwide.
Since the country is a net importer of fuel, she added, the Philippines would feel the impact quickly through higher fuel and electricity costs.
High fuel prices would drive up logistics and transport expenses, worsening the already elevated logistics costs following a series of recent fuel price increases.
The latest increase will take effect on Tuesday, with gasoline projected to go up by P1.70 to P1.90 per liter and diesel by 90 centavos to P1.10 per liter.
It would be the eighth straight week that gasoline prices have gone up, and the seventh for diesel.
Tan said that with high fuel cost, prices of food, basic goods, and public transport would also go up, fueling inflation and eroding household purchasing power.
Cabusas said Central Visayas has already been experiencing increased logistics expenses in recent months due to supply chain and transport challenges.
Additional upward pressure on fuel prices will further strain distribution networks, increasing the cost of raw materials and finished goods that MSMEs rely on daily, he added.
Power rates up too
Power rates in Cebu have also increased recently. Consumer advocacy group Cebu Electricity Rights Advocates (CERA) lamented the latest power adjustment imposed by the Cebu Electric Cooperative (Cebeco) and the Visayan Electric Company.
CERA said Cebeco I, Cebeco II, and Cebeco III—which supply power to northern, southern, and midwestern Cebu—now charge an average rate of P13.37 per kilowatt-hour (kWh).
The Visayan Electric, which supplies power in Metro Cebu, recently adjusted its rate to P12.79/kWh, according to CERA.
Yuvallos said that because Cebu has a trade-driven and tourism-dependent economy, the effects of the increases in fuel and power rates would be felt across sectors—manufacturers, exporters, retailers, and transport operators.
Businesses reliant on imported raw materials may face additional cost burdens due to supply chain disruptions and currency volatility, he said.
Beyond inflation, he added, a prolonged conflict could trigger broader and far-reaching economic consequences —dampen investment, weaken consumer confidence, and slow tourism flows.
Remittances from Overseas Filipino Workers (OFWs) in the Middle East, a critical pillar of domestic consumption, may also be affected if instability persists, Yuvallos said.
Proactive stance
Yuvallos urged local businesses to adopt proactive and precautionary measures, including conducting scenario planning to assess best-, moderate-, and worst-case outcomes; recalibrating sales and growth targets in anticipation of softer demand; and reviewing pricing strategies while remaining sensitive to consumers.
He advised them to strengthen cost management and operational efficiencies, secure supply chains, explore alternative sourcing where feasible, preserve liquidity, and build contingency reserves. —Ed: Corrie S. Narisma
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