Price Comparisons
As I told you in yesterday’s column, the cost of living in the Philippines is rising dramatically. Because this is something that is on the minds of many ex-pats here, I decided to do a little side by side comparison.
For purposes of comparison, I have converted (and adjusted pricing) all into Pounds instead of Kilos. I have also converted all Peso Prices into US Dollars. These conversions were done only in order to make identical comparisons. For conversion purposes, 1 Kilo = 2.2 Pounds. 1 US Dollar = 40 Philippine Pesos. I obtained all US prices by shopping online at Safeway.com. Safeway is a major grocery store in the USA, and while online prices may be slightly different than in-store prices, this should be a fairly accurate list of prices. Philippine prices were obtained by real live shopping in the grocery store, at the wet market, and at the fruit stands.
Price Comparisons
| Item | US Price | Philippine Price |
|---|---|---|
| Ground Pork, 1 pound | $2.99 | $1.71 |
| Pork Chops, 1 pound | $4.49 | $1.50 |
| Bacon, 1 pound | $3.59 | $4.11 |
| Ground Beef, 1 pound | $3.29 | $1.48 |
| Whole Chicken, per pound | $1.49 | $1.17 |
| Tilapia Fillets, 1 pound | $8.99 | $5.25 |
| Fresh Tuna Steaks, 1 pound | $8.99 | $3.30 |
| Large Shrimp, 1 pound | $5.99 | $5.57 |
| Large Eggs, 1 Dozen | $3.29 | $1.61 |
| White Bread, 1 loaf | $2.00 | $1.48 |
| Spam canned meat, 12 oz. | $3.13 | $2.75 |
| Spaghetti Pasta, 16 oz. | $1.25 | $1.38 |
| Prego Spaghetti Sauce, 26oz. | $3.00 | $7.49 |
| Heinz Ketchup, 14oz. | $1.59 | $1.40 |
| Oreo Double Stuff Cookies, 18 oz. | $2.50 | $2.44 |
| Mineral Water, 1 Liter | $1.19 | $0.36 |
| 2 Liter Coke | $1.89 | $1.16 |
| Fuji Apples, each | $0.90 | $0.50 |
| Bananas, per pound | $0.50 | $0.23 |
| Lemons | $2.00 | $1.55 |
| Grapes, per pound | $3.99 | $3.95 |
| Pineapple, 1 fruit | $2.50 | $0.63 |
Some of those prices are shocking! Yes, overall, the cheaper prices are in the Philippines. However, the Philippine side of the ledger is creeping closer and closer to the prices of the US side compared to when I first moved here. I did sneak in one item that is not quite correct in there. That is the Prego Spaghetti Sauce, and the reason I put that is to give you an idea of how the prices of Imported products are! All of the rest of the items on the list are manufactured in the Philippines.
My analysis on this is that for fresh produce and meat, generally the Philippines is cheaper, and by a fair amount. For any kind of prepared products, the Philippines is close to being on par with American products. So, if you want to live here cheaply, you need to prepare your foods from local ingredients. If you buy prepared foods (even if they are Philippine made) the price is quite high, and on par with American prices.
My feeling on this is that it is only a snapshot of where prices are right now. Prices move up no matter where you are, but for the prices here, they seem to be moving up at an accelerated rate, compared to prices abroad.
So, is the Philippines a cheaper place to live? Yes, it still is at this time. It is nowhere nearly as cheap as it was just a few short years ago, though.
What do you think?
Hi Dave – In Bisaya, farm is “Uma” – Bukid is Mountain. BTW, did you know that there are more Filipinos who speak Bisaya as their first language than Tagalog? It’s true! You can check census figures on that. When you say that Tagalogs say that Bisayan people refuse to get along with one of the Philippine’s official languages.. think about this…. who chose Pilipino (which is largely Tagalog) as an official language? The Tagalogs chose it! ha ha… Now, I wonder why the Visayans, who have the largest plurality would not “get along” with the choice of the Tagalogs?
As I said, (used to be an old joke about worn out airplanes) “spare parts (cultures) flying in formation.”
Hi Dave –
Hi Everyone,i did some research over the weekend on global inflation.It appears prices are rising everywhere in the world.Regarding food prices there are two main reasons,higher costs of transportation due to high oil prices and record grain prices due to the expanding bio-fuel rush. Therefore bakery products rise also grain is fed to livestock which increases meat prices.Most hardware products are now produced in China,rising inflation,the rising currency and transport costs in china are now pushing these prices up.As someone once said ‘ We have had too good for too long’ sigh
For those who may be interested,as of today we have record fuel prices here,Diesel £1-10 a litre ($2-17) petrol £1-05 a litre ($2-067). On a slightly different subject,i apologise as a newbie in my 1st post i omitted to introduce myself.I live in the Uk,my wife originally from Valencia,when i retire in 4yrs time it is our intention to relocate to Malaybalay,( I love a quiet life,country boy at heart,cooler climate suits) despite rising prices in Phils,i feel in my lifetime it will always be cheaper there than the Uk. Planning next visit early 2009.
Hi chas – Thanks for your input on the prices, and also for your introduction! I love the Malaybalay area, it is beautiful, clean and peaceful there!
Hi Bob…You guys or great i enjoy this site .Keeps me from being alone in this cold snow filled place .I really enjoyed the pines when i am there ,can’t wait to be back . As far as prices are, I think no matter where u live the pines are cheaper if you don’t need all the imports that you left behind ,that would be the states for me ,i built me a house in the pines and compared to everywhere else it was really cheap to,but in the area I built it, it is considered a wealty home . [ i have a block house ]The food is cheaper compared to the cities , people are nicer and i have no problem with the weather .the prices are half as much as Manila , Cebu or Cagayan De Oro..As far as i am concerned I enjoy having a cheap and excotic home in the pines ..the food is good and so are the people ..and i know i can afford to live there no matter what the cost .
Hi phil R – Certainly, if you want to live cheaper, you must leave those imported items alone, as you say!
So here you all are! I’ve been waiting for a response in the Cost of Living thread.
I see the focus here is food, and I was discussing cameras, but I’m thinking the determinants of price are the same. Namely, supply and demand, supported by Bob’s several warnings about imported items. An obviously exaggerated example would be that locally baked bread would be cheaper than imported by air French baguettes! However, I’m not ready to walk away from the subject of exorbitant prices for certain luxury items like cameras by simply attributing them to supply and demand interplay without asking WHY the supply is short! For example, if a $200(Retail in the US) digital camera can fetch $700 in the Philippines, WHY wouldn’t new market players start importing them? There must be demand. Since posting that question in the other thread last week, I had a conversation with my wife (A Filipina) and another Filipino couple who recently arrived here in the states from Gen Santos City. Starting with the assumption that “Follow the Money” is still a pretty good approach to answering questions, we ended up going in circles! What kept coming up were references to products manufactured in the PI for export which were either unavailable to Filipinos , too highly priced for most, or, and this irritates me, only inferior quality versions or rejects sold locally. I tried to keep the conversation focused on ideas that might uncover profit incentives to explain these anamolies, but, as usually happens in such attempts to solve the world’s problems, we didn’t! The three Filipinos questioned the $700 number for the $200 camera, saying it could be found for $350 to $450. To me, that’s still Amazing!
So, can anyone here shed some light on these seemingly inexplicable facts of life in the Philippine marketplace?
–James
Hi James – I did leave you a reply on the other thread when you asked about the cameras. I guess nobody else had anything to add. Regarding why things work the way they do here…. well, I must say that I know how they work, but a lot of times I can’t figure out why!
About the best solution I have found is to just figure out how they work, and roll with the flow!
I do not believe that the high price of cameras is a supply/demand issue at all, James. There is plenty of supply, but the price is still very high! A lot of what happens here makes no economic sense. I believe one issue is heavy import taxes on such things. Why won’t other players jump in – they will have to pay high taxes too, resulting in high prices. I once ordered some camera batteries from the USA and had them shipped here. The batteries were $5 each. The duty on them was $30 each for shipping them in!
Your wife and friends are right about products made here not being available for sale here. Basically, only the low quality, or defective goods that were manufactured for export are available for purchase in country. It has nothing to do with the price – there are plenty of Filipinos with a ton of money – the stuff just is not sold here! Some of this is done by law, the government regulates which products may be sold locally, and which must be exported.
If your Filipino acquaintances question my assertion that a $200 camera sells here for $700 here, have them stop by and see me! I’d be happy to show them. A Canon camera that has a suggested retail price of $399 was purchased by my Mom for $194 through an online store in the USA. The same camera is being sold today (over a year later) in Davao stores for P29,999 (USD=P40, which means that P29,999 is $749). If I need proof of the fact, I can go take a picture on a store shelf. Believe me, I have no reason to lie about it, James.
I believe you Bob!
Maybe the $350-$450 ones my friends heard about arrived there in someone’s purse.
If the import tarrifs paid by camera dealers are anything like what you experienced with batteries, then these prices make sense.
So, it appears the real problem here is the government, right? Any government that sets ridiculously high import tarrifs on items they don’t compete with domestically, is shooting themselves in the foot, I believe. The only thing I can say in support of it is that it does keep money inside the country, but at the expense of the free exercise of market forces.
What might even be a bigger problem is trying to export things. I’ve always believed that, in general, the US already gets a big enough (some say too big) piece of the world’s pie, and therefore, the bottom line of multi-national exchanges should result in an increase in revenue for the poorer country. I’ve been looking for ideas based on the simple belief that if I could help my relatives in the PI to produce a product that I could market here (US) for a sizeable profit, it would be a win-win enterprise. I would initially pay my Filipino agent the entire cost of producing and shipping the product, and later split my profit here with him, after deducting my cost of sales. However, when I proposed this the other night while discussing the cameras, my friend, who has business experience in Gen San C., informed me that getting products OUT of the country can be as difficult (and expensive) as importing.
He said that often prohibitive expenses result from unscrupulous government employees adding their own PERSONAL tax to expidite your shipments.
Just in: I just found the list below from 1996. Unless things have changed drastically since then, it looks like you should be able to import cameras for 20% or less. Batteries: 30%.
http://www.lawphil.net/statutes/presdecs/pd1978/pd_1464_1978.html
Maybe it’s mostly those PERSONAL taxes!
I’m rambling now. I would like to hear what others think.
–James
Hi James – Yes, I know that the laws for tarrifs here are not that high. However, what happens is that they start throwing fees and such on top of the actual tax, and it all adds up.
Hi all
I haven’t been around much since I moved here a few months ago. I have found that prices on meats are comparable with the prices back in the US. However I lived in a rural area and the prices I paid were considerably lower than in cities.
I have noticed beef here seems to be slightly cheaper but not much(except high quality cuts). Quality on the other hand is very different. All the beef I have bought so far has been rather tough and lean in comparison to in the US. I’m told that I can get good beef at a specialty market but then it would be considerably more expensive even than in the US.
Chicken probably evens out. In the US I usually bought 10 pound bags of leg quarters for 59 cents a pound (I don’t know if those are available everywhere I lived about 100 miles from a major chicken processing area). Much cheaper than here. I have noticed that whole chicken and especially chicken breast is cheaper here though. It seems different cuts don’t vary in price so much here as they do in the US. In the US
I never paid much attention to pork I don’t like it myself but it seems to be about the same prices except for the more quality cuts which are higher in the US.
Some other prices like rent are amazingly low here. We are renting a house for 9,000 pesos($225) a month. Its bigger than we need but was the cheapest we could find before we got sick of looking. The only real disappointment is their is no yard at all just a small patch of dirt beside the carport. I couldn’t find anything close to that cheap even in my rural area back in the US. My water bill is 227 pesos for the month. Electric about 4,500.
As far as products the most annoying thing for me is not being able to find simple things that I really do need. I have problems being sensitive to chemicals so I cant use scented detergents. Even the unscented ones are bothering me here. I have been unable to find washing soda or borax so we have been forced to use baking soda to wash all my laundry.
Things I would like to find here in Davao if anyone knows where.
Washing soda
Borax
Boric acid
33-35% hydrogen peroxide (food grade would be nice)
Hi John H – For quality meats, check Lisa’s Meats, they have locations all over town. Their prices are not too bad too. Finding a house with a decent yard in the Philippines is tough to do, although we have a had a few in the past.
John H: If you don’t find Borax and Boric Acid locally, here’s a commercial supplier that hopefully will ship to you. They have a link for smaller quantities which is easy to miss: it’s labeled “here”.
http://www.rosemill.com/default.asp?pageid=27383
Bob: What’s your experience ordering from outside the country? I suppose the issues we discussed above come into play.
Hi James – Ordering stuff from outside the country is a varied experience. I related one such experience about the camera batteries. Sometimes you get hit by high customs charges. Sometimes there is no customs even when there should be. Sometimes the items never show up. Most of the time it works OK, though.
Hi Bob: Was the high tariff on your batteries collected at a customs office when you went to pick them up, or did customs just arbitrarily charge the company shipping them to you, who then in turn charged your credit card? I’m not trying to be picky, just want to know exactly how this works, for future reference. Based on your last post, it looks like it would be difficult to run a business there, if it involved import of some of the raw materials and export of product.
–James
Hi James – Here in the Philippines, credit card transactions don’t work the same as in the USA. Companies cannot just charge your card for something. In general, they even have to have a physical signature for the charge.
On this occasion, the customs charged DHL (the shipping company). DHL paid it, and I had to pay DHL cash when they delivered it to my house.
Regarding export – exports of stuff are regulated by treaties. For example, let’s look at clothing. A lot of clothing gets exported from the Philippines to the USA. However, it cannot just be done at will. There is a treaty between the Philippines and the USA that spells out exactly how many dollars worth of clothing can be exported to the USA. Once that many dollars worth of clothing has been exported to the USA, not another item can go until the next year. This would generally be the case for all items worldwide (not just the Philippines) when it comes to Import/Export. Countries negotiate these things between themselves.
hey good evening from here in the UK i lived in the Philippines for 3years b4 coming back to the UK for 5months last year. after coming outa SM grocery last year i commented to my wife that prices there are about the same in the UK for grocery and that was in Baguio. i think it depends where you live in the Philippines the further away from Manila the more expensive the prices will get.
As for the peso rising yes i have noticed the decline of the dollar and pound before Cristmas you were looking at php84 to the pound and now its hovering at 78-80php to the pound. maybe there will be massive salary rises this year or everyines being funded by ofw`s who make the peso stronger anyway.
Hi kevin taylor – Yep, those are good observations, and very true!
Hi Bob,
Above you said,
“On this occasion, the customs charged DHL (the shipping company). DHL paid it, and I had to pay DHL cash when they delivered it to my house.”
Why would DHL pay such an extremely high tarrif? Would they not be able to point to the line item in the list specifying the rate for batteries is 20% ? DHL, more than most people, would know what the legal rates are. If you had chosen to challenge the charge, what would have been your recourse?
I’m not trying to be picky. I might have paid the fee myself, just as you did, for expediency. However, I’m trying to look ahead at what I might be getting into if I tried to import 500 batteries!
–James
Hi James – What I have to say about your statement is not mean to be mean to you, keep that in mind. Your statement is naive! If the government says that you pay X amount, you pay it, or you don’t get the batteries. What is written on a piece of paper that lays out the tariffs is meaningless. The truth is, the price they charge IS the 20% for tariff. However, they add administrative fees, processing charges and such, and it adds up to whatever they feel like charging you. The tariff itself is perfectly legitimate and matches what it is supposed to be. The charge that you must pay which includes all the extra fees is outrageous. Sometimes they do that, sometimes they don’t.
James, when you live as a guest in a foreign country, you don’t make a stink about something like paying an extra $30 or $40 on government fees. If you don’t like it, leave. If you complain, the Government can “invite” you to leave (in other words, deport you). Live on the local economy as much as possible, and lick your wounds when you get stuck paying big fees when you import something.
If I chose to challenge the charge? Well, I could let them keep my batteries. If I didn’t like the continued charges every time something is ordered from abroad, I can leave and go live in the USA. That’s not what I want to do, though.
My advice to you, James is to get real. If you have ever lived in a foreign country, I would think that you would understand how things work like this. If you haven’t lived abroad, but plan to – expect to see stuff like this. It’s the way things work in a foreign (especially in a third world) country.
Thanks for your candor Bob!
What you described is as I’ve suspected, but until now, no one was verifying my suspicions. I’m married to a Filipina and was previously married to a lady from Eastern Europe. I had some extended visits to EU and found some “stuff” similar to what you describe here, but I haven’t yet been to the Philippines. Other than EU, most of my foreign experience is based on 3 visits each to Austria and Japan, visiting my sons, who live(d) and work(ed) there. As you probably are aware, these countries are quite straight laced and the government employees play very strictly by the rule books. I’m sure that “stuff” happens there as well when you get involved in big time transactions, but normal, everyday, individual purchases, etc, are quite predictable. If I had more money to live on I wouldn’t be concerned about these matters, but the more I read here about the shrinking of my purchasing power if I move there, the more I think about such things as import tarifs. I guess I better focus on ideas for making money there based on services that can be managed and/or provided over the internet, as you do. The reality you describe is just a little disappointing to me though, as I had hoped to get involved in something that would employ some relatives manufacturing (assembling) products using [mostly] PI materials that could be exported. If the profits stay in the PI, exports will help the economy. I’ve been programming computers since they filled rooms in the Navy; your brain can only deal with *.FOR, *.C, *.C++, and *.HTML for so long!
–James
Hi James – There are lots of business opportunities here, not just dealing with computer related things, so you don’t have to worry too much on that. When you mention of your dream of employing family members to assemble stuff that you can export, I’m sorry to say but thousands of expats have that same idea, and it just never pans out. There are about 6 different businesses that every expat seems to feel he can be the king of (hey, I’ve been there), but these things never pan out, they always seem to flop.
The thing that I have found, though, James is that you have to give yourself the leeway to “think outside the box” – as a matter of fact, just jump out of your box and throw it away. Think in unusual ways that others wouldn’t even consider. That is when you come up with ideas that will really pay off.
The way I see business here is that this is a virtually untapped market. There so many different routes that you can take here to make money, many of them never even tried here. I find that making money in the USA is more difficult because it is a much more mature market that requires you to have a lot of money, and take a huge risk to start up a business. Here, you can do it on a shoestring.
Just returned to the states last month for a visit and I must say
that some of your state side prices are way off. Just bought a lot of
groceries Sat (8 Mar 2008). Here is some of the prices I paid
Pork Chops–$1.29/lb
Spam—$1.99/can
Corned beef–$1.79/can
Corned beef hash–$1.40/can
Loaf white bread—$0.69
Large eggs——-$1.79
Large can coffee–$4.99
On a whole I find food prices in the states and PI balance each other
out. I find most meat and canned food cheaper in the US and seafood,
and some fruits and vegetables cheaper in PI. As far as your PI prices
I see them as pretty accurate except for your price of Fuji apples, I buy them all the time for 10 pesos.
Rick
Rick Austin – My prices are not “way off” as you say. Maybe you didn’t know, but different stores have different prices! A store in Florida has prices that are different from California or Hawaii. New York has variations from prices in Mississippi! I got the prices directly from Safeway.com, so how could they be “way off?” They may be different regionally, or different from what your local store has, but maybe I could say “YOUR prices are way off.”
Bob,
You are right, and what I should of said was they are way off for my area, just as prices in PI vary between areas.
Rick
Thanks, Rick Austin. And you are right, prices vary by region here in the Philippines too.
Hi Bob, I don’t know whether you saw this headline:
“UN warns on soaring food prices
Food prices have risen an unprecedented 40% in the last year and many nations may be unable to cope, the agency says.”
That’s going to hurt everybody, not only the Philippines; especially with rising oil/gas prices.
Hi John in Austria,
It is my thinking that the increase in food prices is directly linked
to risng oil prices due to increased costs to run farm machinary, higher
costs of transportation, the fact that oil is used to manufacture
fertilizers ad pesticides,etc. Hopefully if oil prices drop food prices will
follow.
Rick
Hi John in Austria – I did see that article a while back, or at least a very similar one. Certainly oil/gas prices are playing a role in food prices, but there are other factors in there too.
Hi Rick Austin – Do you think that oil prices will be coming down? Personally, I don’t think that oil will come down an appreciable level, and probably will continue to climb. All indicators would seem to point that way.
hi Bob,
Notice I said if oil peices come down not when. I dont think it will
come down any great amount but one can a lways hope.
Rick
Hi Rick Austin – Yeah, I saw that you said “if” the oil prices drop. No harm intended, I was just asking if you thought they would or not. Sorry if I offended you in some way.
what is a good business opportunities here?
Hi moshe – Good luck with your move to bacolod. My advice to you on business is the same as I always give on the subject: Find out what you are passionate about and figure out how to make money with that. Always follow your passion, and the money will come.
Hi Bob,
No offense meant or taken, Just wanted to make sure you hadn’t
misunderstood what I said.
Rick
how much is the cost of medical insurance
Hi moshe – It varies, depending on what coverage you want, how your health is, etc. You can get PhilHealth coverage for only $25 per year or so!
where to purchase Epsom salts & boric acid in the Philippines? Im residing in Zamboanga City. Please help me. Thanks