The Dept. of Trade and Industry have declared a nationwide freeze on prices of basic commodities last March, slightly ahead of the declaration of a nationwide Enhanced Community Quarantine because of the novel coronavirus. 

But who cares about DTI orders? Prices went up eventually in Iloilo City and in neighboring towns. 

Over-pricing in times of calamitous events, Covid-19 added, have become like a natural phenomenon. The market behavior is perhaps immortalized by Sun Tzu when he said: “In the midst of chaos, there is opportunity.” So, opportunists abound. They are classless – rich and poor are predators alike – and their over-pricing activity is justified by scarcity, thus tolerated. 

In the past weeks, social media were brimming with posts and discussion about exorbitant rates on food, beverages, and other necessities. In spite of the impact of over-pricing on people’s limited resources, predators were like a novel viruses, they remained scot-free. If there were apprehensions made, it is negligible to say the least. 

In contrast, a satirical post like that of Cebu-based artist Bambi Beltran regarding a Covid-19 case handling in Brgy. Luz in Cebu City solicited police attention and earned her an arrest. In the same manner, curfew violations in Iloilo were reported with religiosity revealing intensive day-to-day enforcement from all units of government – the Philippine National Police down to the barangay tanod. This is the reason why Iloilo City tapped the unfortunate list of curfew violators in Western Visayas with a total of 1,258 violators from March 18 to April 20. 

But check out reports regarding violators committed against orders of automatic price ceiling and price freeze by DTI and the Local Government? Zero! The zero result, however, is not an outcome of strong regulatory policy enforcement; it is rather a consequence of weak price monitoring system and zero enforcement of price control measures. 

Over-pricing is rampant especially at the grassroots. The situation was further heightened by informal selling modes that emerged through social media because of the ECQ. This is a weak spot which illustrate the inability of DTI and the LGU to mobilize monitoring and perform enforcement at these levels. 

Proprietors, both from the formal and informal economy, have taken advantage of this weak spot using the ECQ context – limited mobility and deprived access on preferred goods and services by consumers – to engage on economic activity by selling products, including items with fixed prices, at overpriced rates.

First, sellers have taken advantage of the regulatory failure. There are no prevailing price control mechanism at the grassroots or at the barangay level. If there are any, it is either dysfunctional or it is being deliberately set aside. 

Consider these prices from a sari-sari store in Mandurriao district: a loaf of bread costing P65.50 from the DTI Automatic Price Ceiling list would cost you P85; a pack of instant noodle costing around P7.00 on the list is priced at P20 per pack. What is the use of an automatic price ceiling order signed by DTI OIC-Provincial Director Felisa Judith L. Degala and Iloilo City Mayor Jerry P. Trenas when it cannot be enforced at all levels where consumers make purchases?

The consumers, especially the so-called poorest of the poor, does not go out everyday just to purchase a pack of instant noodle at venues where price control measures by the DTI and the LGU are observed or implemented. They go to sari-sari stores and while no one cares about price control at this level; this is where price control measures are needed the most in times of crisis. 

Second, there are sellers who have taken advantage of “regulatory blind spots.” One good example are restaurants who shifted to food delivery following ECQ restriction on casual dining and customer dine-in.

Food delivery operation in Iloilo City is a pretty much young industry and many established local food brands have yet to acquire confidence on the effectiveness of food delivery as an innovation. This is the reason why a collaborative approach like a tie-up with third party food service delivery provider is catching up. Big brands like Food Panda and Grab Food only entered the market early this year, but Covid-19 pushed piloting stage to full operations with merchant partners because of the ECQ. 

The pandemic proved a “blessing in disguise,” the local consumer market embraced food delivery and they recognized its multi-dimensional benefits: effectiveness, efficiency, health, and affordability. Putting proper regulation into consideration, it is not all good news on this part of the business sector.

For instance, there are restaurant owners in Iloilo who expanded operations way beyond its business model and permit by establishing in-house food delivery services midway into the ECQ in lieu of catering on the needs of customers for food. Question on regulation: 1.) Did the LGU provide them with special permit to operate an in-house food delivery services? 2.) How did they arrived on the cost of delivery charges? 

A quick comparative look from social media postings on the cost of delivery service between a resto with an in-house delivery from a food delivery service brand spells a big difference. 

By applying the same factors as input in the food delivery service like: delivery facility (motorcycle), labor (driver), distance, and time; delivery service charge by a resto with an in-house delivery is quite expensive if compared with those food delivery service brands. Of course, one can go deeper into particularities like, price integration on goods and percentages for the purpose of price comparison, but that’s beside the point. 

This is not to endorse food delivery service brands or zero in on restaurant owners alone. There are other sectors who, unwittingly or consciously, have entered the local economy or has expanded business operations without appropriate permit due to government’s weakened ability to establish a regulatory policy. There are plenty of cases to choose from in social media. 

Consumers needs to be reminded that regulatory blind spots are abundant during crisis situations. It nurtures the condition for predators to exploit consumers by overpricing goods just to earn instant profit. Typhoon Yolanda in 2013 was one good example. Covid-19 is an example on progress.