TT inflation hits 10 per cent, Central bank blames food

Members of the Trinidad and Tobago House of Representatives were talking about the rising prices of food Friday as the Central Bank reported that the annualized inflation rate had climbed to 10 per cent by the end of January – a staggering 2.4 per cent increase over the December figure.

The bank said food was mainly responsible for the steep increase.

On the inflation index, food prices were up from 16.8 per cent to 20.8 per cent, a full four percentage point upward move over the same period.

The ‘food inflation’ was mainly in basic edibles:

• bread, cereals (up 14.1 per cent)
• milk, eggs and cheese (28.4 per cent)
• meat (13.7 per cent)
• fish (17.2 per cent)
• fruits (34.8 per cent)
• vegetables (30.2) per cent

What it all means to the consumer is that the average buying power of their earnings had been devalued by four per cent in the space of 30 days while their wages remained fixed. That’s only the big picture. On individual needs it is worse.

A pound of tomatoes that cost $10.00 in December 2007, would have cost $13.02 and fruits at the same prices of $10.00 would be selling at $13.48.

The bank also announced that it has moved up its overnight interest rate - the 'Repo rate' – by 25 basis points to 8.25 per cent. The rate had remained constant for the past 17 months.

The Central Bank said high oil prices, a booming economy and “global and domestic food price shocks" are to blame.

In parliament, Gopeesingh attacked Trade Minister Dr Keith Rowley for comments he made blaming people’s lack of productivity for creating the high prices.

Gopeesingh said Rowley insulted the citizens of the country and demonstrated a lack of compassion.

The Caroni east MP pointed out that the blame was not with the people but the government, which he said had failed to arrest the problem and provide food for the people.

He said people are not getting value for their money, adding that government had failed to deal with the problem of closing the gap between wholesale and retail prices.

Using tomatoes as an example, the MP pointed out that the difference between what a farmer gets and the price at supermarkets is 100 per cent.

And he said it is worse with many other produce. Melongene, he noted, had a markup of 700 per cent, with peppers selling at 300 per cent markup.

Gopeesinghi’s parliamentary colleague for Couva South, Kelvin Ramnath, called it extortion.