BSP flags impact of looming Naia fee hikes on inflation
The upcoming fee increases at Ninoy Aquino International Airport (Naia) could stoke transport inflation by making air travel costlier in the near term, the central bank said, although the higher charges would unlikely upset the overall price growth outlook.
In its latest monetary policy report released on Monday, the Bangko Sentral ng Pilipinas (BSP) said there was a “high probability” that the jump in Naia fees would result in costlier airfares.
Bigger threat
The BSP flagged the increase as it predicted that upward pressure on inflation— as measured by the consumer price index (CPI)—may come from higher transport charges.
It may be recalled that San Miguel-led New Naia Infrastructure Corp. (NNIC), the airport’s new operator, had announced that terminal fees for domestic travelers will rise from P200 to P500 starting September 2025, while those for international travelers will rise from P550 to P950. That was on top of steep increases in airport parking rates that already took effect last year.
But the central bank said the higher fees at the country’s premier gateway would not be enough to upset the inflation outlook—not even its risk-adjusted CPI forecast of 3.5 percent for 2025 that already took into account the possible worst-case scenarios. Overall, the BSP expected inflation to stay within its 2 to 4 percent target range this year.
Latest data from the Philippine Statistics Authority showed that the CPI for air travel had contracted by 8.8 percent in February, easing from the 12.4 percent deflation in January.
“The approved fee adjustments at Naia are expected to impact airfares in the near term,” the central bank said.
“This risk is assigned a high probability, although its inflationary impact is projected to be minimal due to the small weight of air transport in the CPI (consumer price index) basket,” it added.
Various groups had flagged the higher Naia fees, calling the looming increases a “cash grab.”
Beyond airport charges, the BSP said it was mostly worried about potential flare-ups in global oil prices, which could pose a greater threat to its inflation outlook.
“If Dubai crude oil prices were to average $100 per barrel in 2025 and $85 per barrel in 2026, inflation could breach the 2 to 4 percent target range, considering only direct effects and not potential second-round impacts,” the central bank said.
