Caribbean Nations Follow St. Kitts – Nevis Price Contol Plan

Basseterre, St. Kitts – Nevis
November 20, 2007 (CUOPM)

With the St. Kitts – Nevis Labour Government of Prime Minister Hon. Dr. Denzil L. Douglas setting the pace on price control in the region, other Caribbean nations are now weighing in as consumers in other nations, grow increasingly frustrated at the rising cost of food prices including basic items like milk, sugar, rice and flour.

After weeks of discussion on the growing concern in St. Kitts and Nevis with the identification of a basket of food and non-food items, the signing of a Price Control Order and an amicable arrangement between Government and owners of bakeries to freeze bread and other bakery products, CARICOM leaders have agreed in principle to discuss the issue.

Earlier this month St. Kitts and Nevis signed a Price Control Order aimed at limiting prices of a basket of goods.

Twenty-nine items comprising basic food items such as chicken, meats, fish and rice as well as non-food goods including toothpaste, disposable diapers, and some pharmaceutical products are addressed in the Price Control Order.

Minister of Industry, Commerce and Consumer Affairs Hon. Dr. Timothy Harris said the price control initiative is a direct intervention by Government to protect consumers and small businesses from the spiraling costs of goods, and to achieve a level of moderation in the cost of living.

“We empathize with the public concern,” the Minister stressed. “We are aware that the inflationary trajectory of prices is partly caused by imported inflation since we import almost all that we consume.

“The Government, however, is concerned about the diminishing purchasing power of pensioners on fixed incomes, our workers on the Industrial Estate, our domestic workers and other categories of fixed income earners who continue to see their hard earn dollars stretched each week.”

The gazetted Price Control Order will set the maximum wholesale and retail markup to be applied to the listed items. Minister Harris explained that a 20 percent markup of the landing costs for frozen items and dry goods has been prescribed for wholesalers. A retail markup of 30 percent on frozen goods, 20 percent on dry goods and 35 percent on pharmaceutical products of the wholesale price is permitted.

The Minister of Industry, Commerce and Consumer Affairs said the matter of inflation is a national concern and government was careful in considering all factors when making a decision. He cited recent discussions with bakers – who recently sought to raise the price of bread and other baked goods, due to the increase in the cost of flour overseas – in emphasizing this point.

“The bakers were saying that “¦ flour is an important ingredient, but the price of butter has moved significantly [higher] and this is a [concern] for [them],” Minister Harris stated.

St. Kitts and Nevis Permanent Secretary for Industry, Ambassador Her Excellency Rosalyn Hazelle told BBC Caribbean the government is working closely with retailers to protect consumers from the excessive cost of living.

The government has placed several items off the Price Control List and reduced some of the taxes they have to pay when they import goods.

Ambassador Hazelle also adds, “Any business person would be concerned about their bottom line, but we talked about how to address the situation for them, for us but the focus has to be on the federation of the people of St. Kitts Nevis.”

Last week Grenada Prime Minister Dr. the Hon. Keith Mitchell called for a special summit to address the problem.

But St. Lucia Prime Minister Hon. Stephenson King said his administration was not prepared to await a regional solution and announced that the government would intervene in much the same way as Barbados has done and place a cap on certain food items.

St. Lucia’s National Consumer Association President Hubert James told BBC Caribbean they would be investigating how retailers were pricing their goods.

“We do not understand if you have a shipment of a particular good and you still have it in stock why would the price change?”

Mr. James adds, “If you already paid for it why would the price change and is it old stock or new stock.”

Barbados Prime Minister the Right Hon. Owen Arthur has told Barbadians to take greater personal responsibility and do more for themselves to minimise the impact of rising food prices.

Prime Minister Arthur also urged Barbadians to return to “old time values,” like getting together with neighbours and growing more of the food that they eat.

Barbadian consumers should expect an almost immediate reduction in their shopping costs following a government announcement that it has added more items to the basket of goods which will benefit from a 20 percent reduction in retail mark-ups.

There had been some criticism that mainly starchy and fatty foods had been identified among the 10 basic food items initially earmarked for reductions.

Now, selected fruits and vegetables and basic personal care products have been added to the list, and residential electricity costs are also to be subsidized, to give an average 12 per cent reduction in householder’s electricity bills.

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