It’s been a week since my Philippine trip but I am still in shock over the prices of basic food items over there.
Grocery shopping in the Philippines
Take refined white sugar, for instance — it costs only RM1.55 per kilogram in Malaysia but P36 to P40 (RM2.58 to RM2.87) in the Philippines.
Cooking oil in Malaysia, which is normally sold in 5-liter bottles, retails for RM13.35, which translates to RM2.67/liter. In contrast, cooking oil in the Philippines costs P42 to P46 for a 750-mL bottle, which is equivalent to P56 to P61.33 (RM4.03 to RM4.41) per liter.
We’re talking about basic household necessities here, people! Not some fancy-schmancy stuff like horse supplements or car accessories.
I understand that the Philippines is fragmented into more than 7,700 islands, thereby presenting a huge distribution challenge which translates into added cost. And granted that the cost of production may vary from country to country. Hence, I decided to take a look at the price of Nestlé Koko Crunch cereal, which is manufactured in the Philippines. Logically, since it’s made in the Philippines, it should be cheaper in the Philippines, right? Wrong! A 500-gram pack in a shopping centre in Cebu costs about RM20 whereas it’s only RM13.59 in most hypermarkets in Malaysia. How is that logically possible?!
So who gets most of the profit then? The retailer? The wholesaler? The distributor? The manufacturer? Whatever the answer may be, I only know one thing for sure — it’s the Filipino consumer who suffers.
[NB: I made some errors in the conversion and have corrected the figures. The difference is not as big as I initially calculated...but the difference is still significant. Sorry about that. Current rate is around PHP13.90:MYR1.]
you should see the prices of vegetables after the typhoons! one kilo of a certain vegetable went from 40 to 120 pesos per kilo! grabe!
by the way, what’s the conversion rate from RM to peso?
it is because we have too many taxes in the philippines. other than the usual income tax, we have the then 10%, and now 12% value added tax.
and you are correct: the consumer suffers.
i believe one of the main problems is that the government sector itself cannot and do not take full control over the pricing of commodities.
kg: current rate is around P13.90:RM1. as for the post-typhoon prices, it makes you wonder if it’s a supply & demand thing…or unscrupulous traders taking advantage of the situation.
mountain top experience: VAT is 12% in the phil vs 10% sales tax in malaysia.
siyetehan: in malaysia, sugar and cooking oil are price-controlled items (ie controlled by the govt). why can’t the phil govt do the same?? :/
Wow! Does that mean na mas mataas ang standard of living dito? I can’t believe it! No wonder wifey goes gaga over the grocery budget.
rico: it seems that way, yes :( altho i’m not sure how prices are in manila or mindanao.
Same sentiment here. Nakakagulat yung mga presyo sa Pilipinas. No wonder someone I know from here, monthly dito sourced out yung supplies. When she computed kase mas mura pa ring lalabas after considering the shipping cost.
I am really wondering how people make both ends meet there. My heart is out for them.