November 14, 2023
The Governor of the Central Bank of Trinidad and Tobago said what almost every economist worth his sale knew, is that the inflationary pressure in the Caribbean is imported and there is very little, or next to nothing, that any country can do about it.
What he did not say was why we can’t do anything about it. The reason is that most of us import over 80 percent of all that we consume, from food to equipment to appliances. We import them at already high prices from foreign markets.
The second reason is that as oil prices remain unstably high, we will continue to see higher than normal prices in almost everything we use on a daily basis.
There is no need to be concerned about a wage price spiral or even raising rates to tamp down inflation, the former is non-existent and the latter is useless and probably would hurt domestic economies on a fixed exchange rate in any event.
So what do we do? We have to at least begin to feed ourselves. There is no reason why Caribbean fruits are not on the shelves at reasonable prices. That would solve some of our food price inflation a great deal. Secondly we need to ban together with oil producing countries like Guyana and/or Trinidad and have energy security for the region. We need rock bottom prices. No mark-ups.
As for everything else, we just need to bear with it until the post-COVID recovery settles down and prices stabilize.