Dear BSP: It’s Not Our Consumerism, It’s Your Lack of Imagination

Getting off the Grab car I took from a lunch meeting with a client at Mario’s on Morato, I looked up at the ashen sky wondering if it would rain buckets again or if it would just hang there like some inutile government functionary waiting to cash out on a measly retirement check.

The ride cost me around 200 pesos, it took 30 minutes instead of the 15 minutes it used to take. Traffic slowed down to a crawl near the Quezon Avenue underpass crossing Araneta Avenue. The driver explained that the traffic congestion was caused by cars making a beeline to the Skyway on ramp. Ironic that a solution to traffic was also causing traffic.

When I entered my house, the first thing my eyes landed on was the power bill. I tore the envelope up, saw the amount I had to pay went higher though my consumption got lower.

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I entered my home office. Woke up my mac mini. Cranked up my Nespresso. Sat down on my Herman Miller knock off China-made ergonomic chair and began reading my Facebook newsfeed as my espresso shot gurgled into my cup.

First thing I saw was my friend Ella’s post. It was an infograph that said, “Paying premium prices just to maintain baseline level of survival. Budget problem or management problem?” The post was obviously part of Anakalusugan Party List’s messaging, which I guess is directed at lower middle to middle class folks like myself.

Reading the post made me recall BSP Governor Eli Remolona Jr. saying that it was Filipino consumerism and not enough effort at saving money that was causing the peso to sink. Recently it went down to a historic low of 62 point something or other.

Remolona got a lot of flak for that. I won’t repeat what was already said against the BSP Governor. He’s right about the impact of consumer spending as it pertains to imported consumer goods which make up about 20 percent of the dollars our country spends. But then, it just doesn’t move the needle, does it?

The figurative needle I am talking about is what my friend Ella calls “premium prices” for “baseline survival”. Must we, the middle class, really pay so much just for the basics? Power rates are the highest in the region, water service in many parts of the country are unrealiable or virtually non-existent, internet services are also expensive, and so on.

We’re just talking about food, utilities, transportation, and other things middle class people need to make a living. We aren’t even taking into consideration the things that middle class folks have to pay twice for. Our income taxes are supposed to pay for reliable public transport systems and because we don’t have that, we have to have cars or motorcycles in order to get to work on time. Same thing for needing to live inside subdivisions and condos for security thus having to pay association/condo dues, when our income taxes ought to give us adequate protection through the Philippine National Police and other law enforcement agencies. We pay for Philhealth and also have to shell out money for HMOs as well as Medical/Health insurance. We pay for SSS or GSIS, but still have to invest in private pension funds. We send our kids to private school because public schools are no good.

Going back to Remolona, consumerism, and the depreciation of the peso… Why didn’t he, together with the Department of Trade, Department of Foreign Affairs, DENR, DOE, and other agencies sought to substantially revise barter arrangements with Indonesia so that Philippine power companies can get coal without having to spend dollars and thus have one less factor contributing to the upward climb of power rates?

The staggering cost of electricity in the Philippines remains an agonizing burden for everyday consumers, especially when compared to neighboring Southeast Asian nations. While recent micro-level policy shifts and localized barter arrangements have successfully shielded the central bank’s macro-dollar reserves from total collapse, they have done virtually nothing to lower monthly electricity bills. To transform non-dollar trade mechanisms like barter into a weapon that can drastically slash home utility rates, the country must look beyond basic trade items and aggressively overhaul its structural approach to energy procurement.

A meaningful impact begins with pivoting away from minor textile or agricultural exchanges and establishing a direct, state-to-state “Nickel-for-Coal” swap. Because the Philippines is one of the world’s largest exporters of raw nickel ore, it holds a critical asset that Indonesia desperately needs to fuel its massive electric vehicle battery manufacturing boom. By leveraging this domestic resource to secure Indonesian coal, the government could completely bypass volatile global energy markets. This approach would effectively eliminate the multibillion-dollar fuel purchase from the equation, fundamentally lowering the baseline cost of generating electricity for the entire country.

However, acquiring cheaper fuel through barter is meaningless unless the domestic power sector is legally forced to share those savings with the public. Under the country’s current privatized energy laws, power generation companies rely on an automatic pass-through system that allows them to transfer 100% of global fuel shocks directly onto consumer bills. To break this cycle, regulatory bodies must intervene and mandate a new tier of specialized power supply agreements. If a private utility utilizes coal acquired via state-negotiated barter, its allowed generation charge cap must be artificially slashed to reflect the zero-dollar cost of that fuel procurement, thereby ensuring the economic relief actually reaches household pockets.

While pure physical barter provides a strong foundation, long-term scalability relies on transitioning toward a robust Local Currency Settlement framework. By abandoning the rigid constraints of trading physical goods and instead paying Indonesian miners directly in Philippine Pesos or Indonesian Rupiah, the energy sector can permanently cut the US dollar out of its transactions. This structural shift eliminates the heavy foreign exchange risk that forces power companies to add premium buffer charges to consumer bills as protection against a weakening peso. Ultimately, while localized barter offers a powerful short-term mechanism to stabilize input costs, a permanent reduction in power rates requires pairing these alternative trade solutions with an aggressive regulatory overhaul of corporate pricing structures.