Barbados’ PM concerned about global trend of high prices

BARBADOS – The stark reality is that the cost of living today has outstripped the growth in household disposable income of many consumers in both developed and developing countries.

This concern was expressed by Prime Minister David Thompson as he addressed the recently held National Consultation on the Cost of Living.

Prime Minister David Thompson

According to Mr. Thompson, a growing number of houses had barely enough money at the end of the month to pay the bills, to finance mortgages or to cover the expenses associated with raising a family.

“There are many more consumers, especially retirees, those on a minimum wage and those who are struggling to find full-time work, who simply cannot afford the high cost of living and simply cannot keep their heads above water, no matter how hard they try,” he said.

However, the Prime Minister gave the assurance that steps were being taken to address the situation, not only in the short-term, but also the medium and long term. The proposed solutions include: tackling monopolies and increasing competition by removing the middle-man wherever necessary; addressing the inefficiencies at the Bridgetown Port; and reviewing the structure and nature of taxes on some consumer products.

Other considerations include: revising the current basket-of-goods, which currently benefits from the removal of VAT and other impositions to embrace more healthy products such as diabetic foods, foods manufactured for persons who suffer from hypertension and certain foods for children; working with the business community to identify possibilities as they relate to sourcing food from other non-traditional countries; and working with the businesses to determine the possibility of establishing consumer cooperatives in order to benefit from economies of scale.

Mr. Thompson also said that “ambitious policies” needed to be established and implemented to reach the untapped production potential. In this regard, he noted that a thorough policy overhaul was being developed as part of a broader Medium Term Strategic Framework Plan.

He pointed to the need for policies which emphasize several areas, including rationalizing the prices of rent for domestic dwellings; accelerated efforts aimed at developing renewable energy; and greater government intervention in the real estate market to make land and housing more affordable and assessable to the average Barbadian.

“The current laissez-faire practice in the buying and selling of land and other real estate must not be allowed to continue unchecked in the absence of concerted Government intervention into the market place,” the Prime Minister stressed.

He also issued an appeal to the tripartite Social Partnership to commit to a “national sacrifice of restraint in prices and wages with the view of containing the cost of living, especially with respect to the food basket of the consumer price index”.

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