Forex restrictions could lead to unemployment and longer wait for packages says Courier companies

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Forex restrictions could lead to unemployment and longer wait for packages says Courier companies

Unemployment and a longer wait time for online packages.
These are just some of the issues that courier companies are anticipating due to the issues pertaining to limitations on Foreign Exchange (Forex)

This concern follows the announcement by Republic Bank Limited (RBL), which reduced credit card limits from US$10,000 to US$5,000 per billing cycle.

In a GML interview Web Source Chief Executive Officer (CEO) Lincoln Maharaj said that will have little impact on the average consumer because they do not usually spend vast amounts of money per month.

“I don’t believe the average customer we have works for $7,000 a month. The average consumer also does not spend US$1,000 on their card every month for online shopping. Online shoppers today are not luxurious shoppers, and they don’t spend money like years gone by.

“People only buy necessities now, school supplies, a part for their car or something for their house, it’s not like the Bose Soundbar or four tyres for their car, people are not doing that again,” he explained.

He told the media house that the real customer pain point will come when they have to wait longer for their packages due to lower demand brought on by the spending limit.

He said small and medium-sized businesses make up 30 per cent of his company’s customer segment and their stock comes through the company’s skybox.

He added that with lower spending power, companies can only order half the stock they normally do, and when airlines notice a decrease in freight on their aircraft, they will respond accordingly.

“If all the courier companies drop their freight, the airlines will drop their scheduling of planes to the country and that is going to set us backward even more. The smaller Caribbean islands, they will see a cargo aircraft probably once per week, maybe twice for the peak season,” Maharaj explained.

“We are somewhat lucky we get cargo aircraft, Amerijet, and Caribbean Airlines, on an average of four times per week. Now when you cut freight to your country, the airline is not going to see the feasibility and profitability of flying the aircraft as often as they do, because now we courier companies cannot fill the aircraft because there’s no money spending to bring in goods.

“So that right there is going to cut the scheduling of aircraft coming to Trinidad and that is not a good thing because the minute those aircraft find viable routes to fill their planes, poof! They’re gone!”  

He said the macro-environmental impact of the foreign exchange limit will be experienced in the short-to-medium term.