Brace for recession and price hikes in all food staples…

THE WORST IS YET TO COME 

PRICES of virtually all food staples are set to skyrocket in upcoming months. 

Poultry, eggs, beef, fish, cereal, cooking oil, sugar, milk, butter, pasta, frozen and freeze-dried prepared foods, cornmeal, vegetables, fruits, and non-alcoholic drinks are among the essentials that would soon carry much higher retail prices, international experts are warning. 

And since Trinidad and Tobago imports about 90 percent of its food, with an astounding $6 billion annual bill, the impact on consumers would be staggering. 

Food inflation is set to hit a national record, leading to horrible consequences. 

The situation would be worsened by the fact that local food production accounts for a mere one percent of Gross Domestic Product. 

That means that, even in the midst of the world’s worst food crisis in memory, T&T is woefully unable to feed itself. 

The emergency that the International Monetary Fund (IMF) calls “a significant global food crisis” is almost sure to lead to increased poverty and malnutrition in T&T. 

With an estimated one-fifth of the national workforce jobless or under-employed, there is expected to be rampant hunger and under-nourishment. 

Consumers, including the elderly and single mothers, are also facing higher costs of pharmaceuticals following the creation of an importation monopoly.  

The IMF foresees some people soon having to spend more than 60 percent of their wages simply to put the bare essentials on the table. 

The crisis stems from several factors, including the war between Russia and Ukraine, which has crippled production in those food baskets of more than a quarter of the world’s grain and other items. 

Climate change, global shipping gridlock, weak post-Covid-19 yields, and hoarding by some countries are also key causes. 

In addition, higher oil prices have driven up transportation costs. 

There have also been lower fertiliser yields.  

The 33 percent increase in the price of flour imposed on T&T’s consumers adds to incremental hikes in recent months on several key grocery items. 

In addition, several manufacturers have surreptitiously applied “shrinkflation”, which is keeping prices stable while decreasing the size or content of the respective food item. 

It is estimated that over the past six months, the overall cost of food on local grocery shelves has shot up by some 20 percent. 

The Food and Agricultural Organisation (FAO) said that food inflation rose internationally by 22 percent last year and up to 28 percent during the first few months of 2022. 

In recent months, the pandemic and supply issues led to the costs of soya beans and coffee climbing by 52 and 70 percent respectively. 

Chicken prices went up by 14 percent, and most other items are carrying costlier labels.  

On top of that, the World Bank’s prediction of a looming recession would have dire effects on T&T’s one-track economy. 

World Bank’s President David Malplass said that “recession would be hard to avoid”, and urged countries to prepare for the economic downfall. 

But T&T has made no efforts to grow more food, diversify the economy, and boost the agricultural and other prime sectors. 

Economists say Finance Minister Colm Imbert would continue to read deficit budgets and depend on local and international borrowings to fund reduced annual spending. 

The recession may lead to further cutbacks in subventions to loss-making State-owned large employers, including the Water and Sewerage Authority, which could see more workers on the breadline. 

The social safety net is unlikely to receive the required additional funding. 

The government would also be unable to allocate requisite finances to improve roads and bridges, which are in their worst conditions in decades.  

After contracting by almost 10 percent in recent years, the T&T economy was expected to grow marginally as a result of increased global demands for energy products. 

But the ominous recession and inflation would strike a dagger at the purchasing power of the small man. 

While the NFM has said its price increase is expected to be temporary, a review of international wheat prices shows a continuous rise. 

In fact, almost every item on grocery shelves has been more expensive as a result of steeper costs along the supply chain, from farming to manufacturing to transportation. 

The IMF and other agencies say the food price shocks would heavily impact the Caribbean and other vulnerable import-dependent countries.   

Barbados’ and Guyana’s leaders Mia Mottley and Dr. Irfaan Ali respectively have initiated a food production strategy, aimed at moderating the impact of the crisis. 

T&T’s Dr. Keith Rowley has expressed nominal interest in the plan but has not introduced any supportive policy measures. 

The World Bank has called for cooperation and national policies to navigate the crisis and warned of malnutrition, especially among children. 

Measures should include keeping trade relations open, supporting domestic farmers, and aiding at-risk households, the World Bank stated. 

Further, countries “must work to transform food systems so they can become more resilient and achieve lasting food and nutrition security”. 

The bank stressed that “transformed food systems must become a cornerstone for… development”. 

The means mobilising funding and investing in research and development, such as producing diverse and nutritious food with less water and fertiliser, limiting land use, and reducing greenhouse gas emissions.   

Trinidad and Tobago, with minimal food production and an exorbitant import bill, is not undertaking any measures to save hard-pressed consumers from the ravages of the worst crisis of modern times. 

T&T is a sitting duck for the calamitous impact of record-breaking food prices, with attendant poor nutrition and hunger. 

Tough times are ahead, especially for the poor and struggling.