The Ministry of Trade and Industry (MTI) says it continues to actively monitor local and global food prices.
Food prices have been escalating globally on account of a myriad of factors including: continuing disruptions to global supply chains due to the Covid-19 Pandemic; the Russia/Ukraine conflict; increases in shipping, logistics and freight cost; rising fertilizer and energy prices and adverse weather conditions.
The overall inflation rate in the United States of America as of February 2022 was 7.9%, which is the largest surge in inflation in nearly 40 years; for Canada, inflation was 4.7%, representing an 18-year high; and the United Kingdom (UK) registered inflation of 6.2% in February 2022, a thirty-year high. Within the Caribbean region, many countries are also experiencing high inflation levels.
According to the Central Bank of Trinidad and Tobago in its March 25, 2022 Monetary Policy Announcement, headline inflation domestically stood at 3.8 per cent (year-on-year) in January 2022 compared with 3.9 per cent in October 2021. Food inflation eased to 6.6 per cent from 7.6 per cent in October, partly due to the zero-rating of Value Added Tax on additional food items from November 2021. Core inflation (which excludes food items) remained steady at around 3 per cent. Indications are, however, that imported inflation will continue to push up local prices of food and other items in coming months.
The Ministry said Government has been working proactively to monitor and address rising food prices and has implemented the following measures to address rising prices
- Zero-Rating of Basic Food Items
VAT was removed on an expanded list of food items as announced in the Fiscal 2022 National Budget Presentation.
- Suspension of the CET on Basic Food Items
The Government also pursued the suspension of the Common External Tariff (CET) on a list of over 20 basic food items. This initiative will help to keep these items affordable for consumers.
- Comprehensive Review of the CET
Currently Trinidad and Tobago is actively participating in the Region’s Comprehensive review of the CET which is aimed at modernizing the regional regime on tariffs to reflect the current realities of national and regional production. Under this initiative it is expected that tariffs will be adjusted to reflect the measures being implemented at both the national and regional levels to support food security and regional industrial policies including those related to the agriculture and agro-processing sectors to the ultimate benefit of consumers and the economy.
- Increased Supply of Forex via EXIM BANK Ltd
The Government has increased the supply of foreign exchange under the EXIM BANK to address the financing constraints faced by manufacturers and importers. An accumulated disbursement of US$650 million has been made available under two (2) facilities namely, the FOREX Facility for Manufacturers and the Forex Allocation System (FAS) for the importation of raw materials, basic food items and essential goods.
- Agriculture Stimulus Package
The Government is committed to boosting agriculture output in Trinidad and Tobago. To this end, the Government is currently implementing a $500 million Agriculture Stimulus Package. Funding from the Programme will support the rapid expansion in production and marketing of selected high-demand commodities with short production cycles such as vegetables.
- Strengthening Linkages between Industry and Agriculture
Linkages are also being strengthened to promote greater synergies between industry and the domestic Agriculture sector. A working group inclusive of the Ministry of Trade and Industry (MTI), the Trinidad and Tobago Manufacturers’ Association (TTMA), the Ministry of Agriculture, Land and Fisheries (MALF) and the National Agricultural and Marketing Development Corporation (NAMDEVCO) has been established to collaborate towards build supply chain linkages between manufacturers and the Agricultural sector.
- Food Price Monitoring Mechanism
The Consumer Affairs Division (CAD) of the Ministry of Trade and Industry (MTI) also has an effective mechanism for monitoring prices in Trinidad and Tobago through the conduct of monthly and quarterly price surveys of key retail outlets, namely supermarkets, poultry shops, hardware stores, medicine and pharmaceutical products at pharmacies. These surveys are published in print and social media. The next survey will be published in the weekly newspapers by 03 April 2022.
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